Malta regulator pushes back enforcement date of framework regulating crypto, NFTs

The Malta Gaming Authority has announced an extension to the so-called “Sandbox Regulatory Framework” on the use of Innovative Technology Arrangements and the acceptance of Virtual Financial Assets and Virtual Tokens.

The policy governs the acceptance of cryptocurrencies as a means of payment by MGA licensees, along with the use of distributed ledger technology (DLT) in their operations, such as smart contracts and gaming platforms based on DLT.

Following the conclusion of the Sandbox Framework on 31 December 2022, the policy was set to come into force and delineate the rules applicable to operators that wish to obtain approval under the new regime.

However, the date for the new guidance on the use of crypto and tokens is now being pushed back. The Maltese regulator is advising all interested parties that the applicability of the Sandbox Framework is being extended to 28 February 2023.

In the interim, the MGA said it will continue to work towards consolidating “the extensive feedback received” through a closed consultation process concerning the proposed policy, which ended on 14 December 2022.

The MGA's first regulatory workshop focused on the proposed policy for the acceptance of cryptocurrencies as a means of payment by MGA licensees, and the use of DLT in their operations, such as smart contracts & gaming platforms based on DLT. Read more: https://t.co/e4pTA367vn pic.twitter.com/3hZJiwrTRu

— MaltaGamingAuthority (@MaltaGamingAuth) December 2, 2022

The Malta Gaming Authority has been hosting a series of regulatory workshops with the aim of “further strengthening the dialogue between the authority and the industry” as of late, encouraging the exchange of views around regulatory topics. The first workshop, held in early December, tackled the proposed crypto policy.

MGA CEO Carl Brincat said last month the Authority was committed to pulling the same rope along with operators and service providers of good will. “Such workshops are testament to our commitment to keeping an open and collaborative dialogue with the industry, by creating space for such feedback to be freely communicated,” he said. “This, in turn, enables the Authority to regulate a market space that is simultaneously competitive and safe.”

The workshop was addressed by Odhran Griffin, MGA System Auditor, and Brandon Debattista, MGA Head of Legal and Regulatory Affairs. Representatives from the Financial Intelligence Analysis Unit (FIAU) and the Malta Financial Services Authority (MFSA) were also present during the workshop and contributed to the discussion by presenting their position.