Malta’s Financial Services Authority said Monday, it wants to remove service providers for non-fungible tokens (NFTs) from the scope of its 2018 virtual assets law as it prepares the ground for new European Union (EU) crypto legislation.
The country’s 2018 Virtual Financial Assets (VFA) Act requires service providers to be authorized and to publish white papers of investor information before issuance. That would mean it potentially goes further than the EU’s Markets in Crypto Assets Regulation (MiCA) which is set to apply in Malta and across the bloc as of 2025
The Authority considers that it would be prudent that certain VFAs, which display clear characteristics of uniqueness and non-fungibility, also be excluded from the VFA Framework,” said a consultation document from the regulator.
NFTs, a digital record of ownership of an asset like artwork or real estate, had limited use for investment or payment purposes, the Maltese regulator said.
Under the final draft of MiCA, NFT service providers won’t have to register as long as their assets are assessed as genuinely non-fungible.
Malta, one of the EU’s smallest member states, has also been one of the first to set its own crypto registration regime, and the MFSA says that, on its current drafting, its existing national laws would normally include most NFTs.