How Malta Became a Hub of the Cryptocurrency World

Two of the world’s largest cryptocurrency exchanges plan to make the tiny European nation of Malta a central hub of their operations, and analysts say others are sure to follow. Officials on the Mediterranean archipelago, the European Union’s tiniest member, are aiming to boost its fortunes by becoming one of the world’s friendliest jurisdictions for a sector that’s caused concern among other regulators.

At a time when countries around the world are expressing ambivalence about cryptocurrencies, if not cracking down on them, Malta is writing rules that should give exchange owners and users certainty about the future. The rules will cover how brokerages, exchanges, asset managers and traders operate, making them among the broadest set of regulations for the industry. “The proposed framework will offer legal certainty in a space that is currently unregulated,” the government said in a consultation paper. A national tax policy that permits international companies on the island to pay a rate of as little as 5 percent doesn’t hurt, either.