Malta’s crypto regulatory regime is facing new pressure after a European review flagged concerns over how the island nation is authorizing crypto companies under the EU’s MiCA framework.
The European Securities and Markets Authority (ESMA) recently completed a peer review of Malta’s Financial Services Authority (MFSA), specifically scrutinizing its handling of a crypto asset service provider (CASP) license. The result? ESMA says Malta fell short on key authorization standards, despite having strong resources and sector knowledge.
The review, initiated in April, is part of a broader EU effort to ensure consistency in how MiCA is implemented across member states. ESMA’s recommendations target gaps in pre-licensing oversight, calling for stricter attention to unresolved issues before licenses are granted—not after.
While the findings don’t name the company in question, four crypto firms currently hold MiCA licenses in Malta: Bitpanda, Crypto.com, OKX, and ZBX. Some have already faced regulatory penalties, including a $1.2 million fine issued to Okcoin Europe earlier this year.
Industry experts say the review is unlikely to result in revoked licenses, but it could force regulators like the MFSA to rethink how rigorously they screen applicants. Juan Ignacio Ibañez of the MiCA Crypto Alliance noted the tension between Malta’s ongoing monitoring approach and ESMA’s preference for front-loaded enforcement.
Though ESMA doesn’t have the authority to directly intervene in national licensing, its findings are expected to influence regulatory behavior across Europe as MiCA takes full effect.
Alexander Stefanov
Reporter at Coindoo
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Source: https://coindoo.com/malta-faces-eu-pressure-over-lax-crypto-licensing-practices/