Difficulties for crypto companies to get bank account in Malta – financial secretary is trying to solve the situation

Silvio Schembri, the parliamentary secretary and junior minister for financial services on Malta.

Silvio Schembri, the parliamentary secretary and junior minister for financial services on Malta. Image source: Shutterstock/Pixabay

Anthony Livebrant

anthony.livebrant@trijo.co

Malta wants to be at the forefront of the crypto development. Junior minister for financial services Silvio Schembri has repeatedly said that Malta will be a crypto island. Nevertheless, the country's banks are still critical to the industry's entrepreneurs.

Malta’s parliamentary secretary and junior minister for financial services Silvio Schembri wants the small island of the Mediterranean to be known as the crypto island. Several companies are now in the process of moving their business there, like the crypto exchanges Binance and OKEx.

“Malta aims to be the global trailblazer in the regulation of blockchain-based businesses and the jurisdiction of quality and choice for world class fintech companies”, the country’s government recently announced, according to Independent.

Malta’s banks are critical

Even though the government is positive, Malta’s banks are critical to all types of businesses involving blockchain technology or crypto practices. Such companies are currently having difficulties in opening a bank account on Malta. This according to James Catania, CEO of Intelliblock ltd, a service company that among other things helps companies with ICOs and other matters within the blockchain industry.

“Many clients get frustrated. The word is spreading that it is almost impossible to successfully open a bank account in Malta when blockchains and cryptocurrencies are involved. Even my own company has the same problem”, says James Catania to Trijo News.

His clients often want advice from him before moving their business to Malta, oftentimes attracted by the positive statements from the Malta government regarding blockchain operations.

The consequence of the banks’ critical attitude, however, is that customers are forced to open bank accounts in other countries, for example Singapore and Switzerland.

James Catania has written about the problem in the closed Facebook group “Bitcoin Malta”.

James Catania's post.

James Catania’s post. Image source: Facebook

The secretary for financial services Silvio Schembri replied the post.

Finance Minister Silvio Schembri's answer.

The secretary for financial services Silvio Schembri’s answer. Image source: Facebook

The problem is “lack of education”

According to James Catania, it is important that the politicians’ positive attitude towards the crypto world is also applied by the employees at the banks. He means that the problem is that there’s a fear among banks regarding the new phenomenon. Instead of seeing the opportunities for development and practicality in the blockchain technology, they see money laundering, drugs, and other illegal activities.

“In fact, there are obviously worrying activities in these industries. But the fear arises because of the lack of education in the field. If the banks get a proper education, the problem will more or less disappear and the opportunities will overcome the fear”, he says.

There is a big difference between cryptocurrencies and the blockchain technology, James Catania says. It is important to be able to distinguish between them.

“This is something the outside world, and especially the banks of Malta, have not yet grasped properly.”

Trijo News has tried to get in touch with Bank of Valletta, one of Malta’s biggest banks, but without success. The bank has previously not wanted to say so much about the situation.

However, in an article from Times of Malta, a spokesperson from the bank said that their views on transactions with cryptocurrencies were governed by “its own risk appetite, regulatory directions and the exigencies of its correspondent banking network”.

UPDATE: The headline of this article has been changed as the previous one was misleading.

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