The world’s largest cryptocurrency has found a new home on one of the world’s smallest island states. Prime Minister Joseph Muscat warmly welcomed the cryptocurrency platform and spoke of his desire for Malta to become “global trailblazers in the regulation of blockchain-based businesses and the jurisdiction of quality and choice for world class fintech companies”. Colleagues joined him in welcoming Binance and spoke of a desire for Malta to become known as “the blockchain island”.
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Malta Bids to Become Blockchain Island to Switzerland’s Crypto Valley
If Zug in is Europe’s crypto valley, Malta is bidding to come its island equivalent. The Mediterranean island, with a population of 450,000, is a major hub of banking and finance and is a global leader in the online gambling industry. On March 23, Binance announced that it would be moving its operations to the island, which is a European Union member. The cryptocurrency exchange, the world’s largest by trading volume, has been searching for a home after regulatory action in China, Hong Kong, and Japan forced it to look elsewhere.
Binance is seeking to introduce fiat payment facilities, and in Malta it has found a country that is plugged into Europe’s banking sector and rated by the IMF as having an advanced economy, placing it in the world’s top 32 countries. Binance that it settled on Malta “due to its existing pro-blockchain legislation and the stability that it offers financial technology companies through its regulatory framework.” The news comes on the same day that Japan’s Financial Services Agency an order for Binance to cease its operations in Japan, stating that it was breaking regulations on funds settlement.
Malta Opens Its Doors to Crypto Businesses
Changpeng Zhao
Many European nations, such as the UK, have been sceptical of cryptocurrencies, and reluctant to embrace tech companies working within this burgeoning sector. While the British government has dragged its heels, going only so far as to commission a task force to “manage the risks around crypto assets”, Malta has drawn up a to encourage their use. It’s in the process of enshrining a Virtual Currency Act into law.
“Binance’s presence in Malta sustains our vision, that of making Malta ‘The Blockchain Island’,” said Parliamentary Secretary for Financial Services, Digital Economy & Innovation Silvio Schembri, joining his in welcoming the exchange. With Binance seeking to recruit 200 staff as soon as possible, the move will provide an instant boost to the island’s economy, and bolster its quest to become a center for crypto innovation.
“Binance will soon start a “fiat-to-crypto exchange” on the European island nation, and is close to securing a deal with local banks that can provide access to deposits and withdrawals,” said CEO Changpeng Zhao. He also encouraged other crypto businesses to follow Binance’s lead and consider relocating there. The move will be particularly beneficial to European customers, who should soon have another major exchange that will accept fiat deposits. Binance strengthening its grip on the market raises just one concern: if the exchange were to suffer a hack or technical problem, it could significantly disrupt the crypto markets.
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El Petro, the Venezuelan cryptocurrency, can now be purchased with Russian rubles, among other fiat currencies, President Nicolás Maduro announced. Companies from many countries, including the United States, want to buy the oil-backed crypto, he added. Venezuela’s head of state also said he decided to denominate the national currency, the bolivar.
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Yuan and bitcoin Also Accepted
Starting from March 23, all citizens and enterprises will be able to buy with Russian rubles, Chinese yuan, Turkish lira and euro, as well as with cryptocurrencies like bitcoin, ethereum and NEM,” Venezuelan President Nicolás Maduro said, speaking to local TV. During the 30 days of the pre-sale of the petro, almost 201,000 orders from 133 countries have been placed, totaling $5.25 billion USD. “We are just starting”, said, adding that many businesses, including American, have declared intentions to purchase the Venezuelan cryptocurrency.
“Companies willing to buy petro come from Colombia, Spain, Mexico, Argentina, Peru, Turkey, Germany, Russia, China, Ecuador, and Chile,” Venezuela’s head of state revealed, quoted by RIA Novosti. His statement comes days after US President Donald Trump signed an executive order American citizens and legal entities from any transactions with Venezuelan cryptocurrencies.
Venezuela released its oil-backed petro in February, thus becoming the first country with own cryptocurrency supported by petrol reserves. Earlier Nicolás Maduro announced the country had collected $735 million USD through the pre-sale.
Recently, reports came out that Russia might have been involved in the development of the petro. A Time investigation circumstantial evidence connecting Moscow to its launch. Russian officials have denied the claims. Through its spokesman, the Finance Ministry stated it had nothing to do with the creation of the petro. Artem Kozhin said all such speculations were “outright lies”. He also called the “pseudo investigation” a “fake sensation”.
Maduro Denominates the Bolivar in the Name of Stability
“I’ve decided to remove three zeros from the current money and replace these bills with new ones”, Nicolás Maduro announced. The national fiat will be denominated “to guarantee the country’s economic stability”, in his words. The Venezuelan president showed new specimen banknotes, which will be officially released on June 4, 2018.
For the first time in years, coins will be minted in Venezuela whose currency has been suffering from hyperinflation. 50 céntimo and 1 bolivar coins will be issued along with 2, 5, 10, 20, 50 и 100-bolivar paper notes. A special emission of bolivars will feature the national heroes and , on 200 and 500-bolivar bills respectively.
The extremely high devaluation of the bolivar in recent years has forced Venezuelans to mostly use bank cards. One US dollar currently trades for about 230,000 bolivars on the black market in Caracas. Several days ago financial authorities issued 100,000-bolivar bills to relieve the cash deficit.
Do you think the petro can actually help stabilize the national fiat currency of Venezuela or it will simply increase its devaluation? Share your thoughts in the comments section below.
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