MALTA Law and Practice Contributed by: Ian Gauci and Cherise Abela Grech, GTG Legal
lines promoted Malta as one of the first countries to have regulated cryptocurrency exchanges and other cryptocurrency-related services. With MiCA now being fully applicable, opera - tors of cryptocurrency exchanges seeking to offer services in the EU are required to apply for a licence. The specific licensing category depends on the operations of the service pro - vider and thus, in the context of an exchange platform, whether the exchange qualifies as a trading platform or not. The operation of a trad - ing platform refers to multilateral systems that bring together or facilitate the bringing together of multiple third-party purchasing and selling interests in crypto-assets, in the system and in accordance with its rules, in a way that results in a contract, either by exchanging crypto-assets for funds or by the exchange of crypto-assets for other crypto-assets. The operation of this type of platform triggers the requirement for a Class 3 CASP licence. Where on the other hand a CASP is not oper - ating this type of platform, even if prima facie, it may look like a cryptocurrency exchange, it is crucial for that applicant, together with their legal adviser, to determine the specific services to be offered before proceeding with submitting an application for authorisation under MiCA. See 6.1 Permissible Trading Platforms for additional information on the regulation of crypto exchang - es and new regulatory changes with the coming into force of MiCA. 6.4 Listing Standards Issuers of VFAs listing on VFA exchanges are required to abide by the listing rules adopted by each respective VFA exchange. Under MiCA, CASPs operating a trading platform for crypto- assets should also have detailed operating rules, be subject to pre-trade and post-trade transpar -
ency requirements, and set transparent and non- discriminatory rules governing access to their platforms, based on objective criteria. Issuers of traditional financial instruments (eg, equity securities or debt securities) listing on the MSE are required to abide by the Listing Rules, whereas those listing on the Prospects Market are required to abide by the Prospects MTF Rules. 6.5 Order Handling Rules When VFA licence holders and CASPs under MiCA handle client orders, they are required to implement procedures and arrangements that seek to provide the expeditious execution of such orders. There are also obligations imposed on licence holders/CASPs not to misuse infor - mation relating to pending client orders, and to take all reasonable steps to prevent the misuse of such information. 6.6 Rise of Peer-to-Peer Trading Platforms The increase in cryptocurrency exchanges has highlighted the advantages of P2P trading plat - forms. While this has not impacted the regulation of traditional trading platforms, regulators have sought to cater for such platforms, (previously) locally through the enactment of the VFAA, and now on an EU-wide basis through MiCA. 6.7 Rules of Payment for Order Flow There is no information available in this jurisdic - tion. 6.8 Market Integrity Principles Marketplaces, exchanges and trading platforms are required to abide by the principles of the Market Abuse Regulation, which aims to prevent and detect market abuse, market manipulation and insider dealing.
541 CHAMBERS.COM
Powered by FlippingBook