The Malta Financial Services Authority (MFSA) on Wednesday issued the second volume ‘The Nature and Art of Financial Supervision’, a publication focusing on supervision in the Virtual Financial Assets (VFA) sector.
It provides an overview of the VFA Framework, including how it is being implemented vis-à-vis the authorisation and supervision of VFA Agents and VFA Service Providers, as well as the registration of whitepapers in relation to Initial VFA Offerings.
The document highlights leading observations made by the MFSA over the past year, and clearly sets out its expectations.
In this respect, the MFSA said in a statement that it expects VFA licence holders, as well as prospective applicants under the Act, to take careful note of this publication and the recommendations being made, to benchmark themselves and their operations, and to take corrective action where applicable.
The publication also refers to the European Union’s adoption of the Digital Finance Package, including legislative proposals on the regulation of Markets in Crypto Assets (‘MiCA’). A comparative analysis with the VFA framework is also provided.
In 2021, the MFSA shall be consulting with the industry on the alignment of the VFA framework with MiCA.
MFSA CEO ad interim, Christopher Buttigieg, commented that “the VFA Sector is relatively new. Today’s publication, the second of this series, provides an overview of the authority’s work, observations, and expectations in this area.
“Reputation is key and therefore firms’ full compliance with the framework is crucial.”
Herman Ciappara, Head of the authority’s VFA function, stated that “the publication of this document is an important milestone as it sets out our expectations for the sector.
“Next year will see the licensing of a number of VFA Service providers and we shall thoroughly be supervising the sector. Moreover, we will also be proposing updates to the Rulebook to ascertain that the framework remains robust and continues to achieve its objectives.”
The document is publicly available on the MFSA website.
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