The Pacific island nation of Vanuatu has asked Malta for assistance in the creation of blockchain and ICO legislation.
The Maltese government has agreed to help Vanuatu in creating regulations for the blockchain industry and initial coin offerings (ICOs) in the Pacific island country, the Vanuatu Daily Post reported on Monday.
Noting the importance of appropriate regulatory frameworks for the nascent sector, Vanuatu’s minister of foreign affairs Ralph Regenvanu has requested assistance from Malta, following the latter’s successful legislation implementation. Regenvanu has also reportedly proposed the formation of a “Commonwealth of Blockchain Islands”.
Malta’s prime minister, Joseph Muscat, has responded favorably to the request and welcomed the suggestion of establishing common blockchain regulatory standards in the islands.
In October 2017, Vanuatu became the first country to officially accept Bitcoin (BTC) payments in exchange for citizenship. James Harris, managing director of the Vanuatu Information Centre Network, said at the time that while “there remains some suspicion surrounding the use of cryptocurrency in financial transactions,” Bitcoin payments are “fully traceable”.
More recently, however, the Reserve Bank of Vanuatu (RBV) issued a public warning, stating that cryptocurrencies are “not recognized as legal tender in Vanuatu and are not issued or regulated by the bank.” The statement, published in mid-September, has raised concerns among state regulators, who suspended the granting of Financial Dealers Licenses (FDL) to crypto and blockchain-related businesses until the creation of the respective legal framework.
The “Blockchain Island”
In July, the Maltese parliament approved three cryptocurrency and blockchain-related bills. The legislation brought legal certainty and integrity to the growing virtual currency market in the archipelago, dubbed the “Blockchain Island” by government officials introducing the industry-friendly changes.
Living up to this nickname, Malta has attracted several large cryptocurrency exchanges, including two of the biggest platforms by trading volume Binance and OKEx. The island nation has also recently unveiled the world’s first blockchain and cryptocurrency stock exchange. In addition, Binance revealed in July its participation in a Malta-based decentralized crypto bank project, dubbed Founders Bank.
Speaking at the United Nations (UN) earlier this month, Muscat said that cryptocurrencies are the “inevitable future of money” because their underpinning technology, the blockchain, makes these financial instruments more transparent than traditional currencies.