Malta Denies COINMALEX, Crypto Foxtrades Have License to Operate

Two crypto exchanges called “COINMALEX” and “Crypto Foxtrades” are neither licensed to operate nor regulated in Malta, the country’s chief financial watchdog said.

Both exchanges claim on their websites that they are licensed or operating in the island nation’s fledgling cryptocurrency industry. One of the flagged entities, Crypto Foxtrades, went a step further, claiming that it holds a Category 3 Investment Services provider from the Malta Financial Services Authority. The MFSA, however, issued a statement denying that it has ever regulated any of the two platforms or that they ever had permission to operate in the country.

“The MFSA wishes to alert the public, in Malta and abroad, that Crypto Foxtrades is NOT a Maltese registered Company NOR licenced or otherwise authorised by the MFSA to provide the service of an Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term or other financial services which are required to be licenced or otherwise authorised under Maltese law,” the MFSA said.

The Maltese financial watchdog further emphasized that operating a crypto-related business in the country requires an MFSA license under the Virtual Financial Assets Act of 2018.

Malta warns against Binance

The authority had issued a similar warning last month, but this time it was not just another crypto exchange, but the world’s largest crypto venue by trading volume, Binance.

Due to the commotion that MFSA’s statement caused in the crypto community, Binance CEO Changpeng Zhao has come out to assure its users that all claims about being based in Malta or opening offices there were completely untrue, which implicitly means that the regulator’s warning makes no sense.

Speaking via an update on Twitter, CZ said, “there is a mix of truth, FUD & misconception. [Binance] is not headquartered or operated in Malta. This is old news & has always been the case, hence there is quite a bit of FUD turning this into a breaking story. The community’s comments show that understanding.”

The MFSA has previously warned many crypto firms against falsely advertising unregulated products as being supervised in Malta. The watchdog added that these financial promotions were unlikely to provide consumers with the clarity required by its rules and could leave them unable to understand whether the promoted products or services were beyond its remit.

The financial regulator said earlier this year it has received ‘Letters of Intent’ from 34 prospective digital assets providers, of which are 21 crypto exchanges seeking authorization in Malta.

Until October 2019, these crypto providers had been operating under the transitory provisions set out in the country’s Virtual Financial Assets Act, which provides a set of rules for those operating a cryptocurrency-related business. Those wishing to continue providing their services in the rising crypto Hub Hub A hub as its name suggests describes the center of activity or a focal point. In terms of finance, the term hub can refer to Hub and Spoke Trading or a liquidity hub. However, the terms are not interchangeable, but they do overlap. Hub and Spoke trading refer to a network that posts bids and offers for an asset and therefore creates a real market. For example, Hub and Spoke trading allow traders to see the other submissions and offers from other traders on the platform. This is a popular method A hub as its name suggests describes the center of activity or a focal point. In terms of finance, the term hub can refer to Hub and Spoke Trading or a liquidity hub. However, the terms are not interchangeable, but they do overlap. Hub and Spoke trading refer to a network that posts bids and offers for an asset and therefore creates a real market. For example, Hub and Spoke trading allow traders to see the other submissions and offers from other traders on the platform. This is a popular method Read this Term, following the expiry of the transitory period, are now required to apply for authorization with the MFSA.