As crypto markets draw more and more attentions, the European countries also show supportive stances to accept the new economic trend. Regardless of the pro-blockchain climate, low corruption and global potentials, European markets do not have enough advantages to draw more crypto projects and startups. This is because of national regulations of cryptocurrencies are differed from a nation to nation. However, this less-harmonized conditions allow some countries to be more tempting cities to start.
The Cayman Islands are considered one of best places for businesses with privacy, efficiency and safety in the world. The islands are autonomous British Overseas Territory in the western Caribbean Sea. This is why the islands are parts of Overseas Country and Territories of the EU(OCTs) even without the direct intervention. In other words, the Cayman Islands’ authorities have not issued by any cryptocurrency specific regulations. As there is no fixed rules to adhere, the existing AML, money services, mutual funds and security laws gain power to ICOs and established crypto businesses.
Moreover, it will be difficult to find better places for international crypto projects than the Cayman Islands, especially for international financial businesses. The businesses can be established and expand with high-quality financial infrastructure, trustful links to worldwide financial centres, easy tax regimes: no income, capital gains, wealth or inheritance tax and no controls for currency exchanges.
With flexible regulations and beneficial settings to international businesses, the Cayman Islands are grabbing more and more attention to newly opened crypto businesses. In 2018, the Cayman Islands overpassed Switzerland as the 2nd leading country in the world with the increase in the fund over $4.2 billion through ICOs.
After the breakdown of the Soviet Union in 1991, Estonia had faced a swift change economically by skyrocketing its economic conditions as the EU’s new member state. Reliable and open government and Estonia’s new goal to lead the advanced digital society in the world make the country attractive to crypto startups.
To be specific, Estonia is showing great efforts to actualize the digital society by activating e-governance, e-tax, digital ID, e-voting, e-health and e-residency. In addition to that, Estonia has applied blockchain technology in its health, judicial, legislative, security and commercial code since 2012. The Estonian government is operating 24/7 to consult new crypto/ICO projects while everyone can start LLC(online) with less than €5,000 in an hour. The whole practical and operational system justifies “E-stonia”.
Considering the fact that ex-Soviet country with a small amount of population, Estonia made great achievements. In the first half of 2018, Estonia raised over $323 million and reached the 7th leading world market in funds raised through ICOs.
However, unlike the Cayman Islands, Estonia has comparatively strict regulations on cryptocurrencies. They require proper licenses and pre-registration to the Estonian Financial Intelligence Unit(FIU) to exchange digital assets and become custodian wallet providers. Coins and tokens should be qualified by the Estonian Financial supervisory Authority(EFSA).
Malta is approaching and opening up the crypto market in an innovative way.
According to the junior minister of financial services in Malta, Silvio Schembri, Malta will push more heavily at the technology than blockchain-focused companies to prevent potential technological flaws. It is obvious that unlike other regulations, Malta puts more emphasis on technology. Furthermore, Maltese authorities announced that the idea of new and technologically competent body audited and licensed the businesses has brighter future. Even the Maltesian Digital Innovation Authority(MDIA) holds authorities to confirm a license.
Mr. Schembri stated that on July 4 of 2018, three crypto-specific bills, the first world jurisdiction to provide legal certainty to crypto space, have passed to the law. The first bill includes the duties and responsibilities of the recently established Digital Innovation Authority that MDIA gives out a legal permission to make use of a DLT platform. The second bill, the Innovative Technology Arrangement and Services Act(ITAS Act), takes care of arrangement of cryptocurrency exchanges and their certifications. The last, the Virtual Financial Assets Act (VFA Act), is about setting up regulations governing ICOs, exchanges and custodian wallet providers. The newly introduced ones are folllowing the rules of market integrity and the protection of consumer and industry.
All innovative approaches to crypto regulations have made Malta “the world’s first blockchain island”, grabbing attentions from recognizable crypto companies like BitBay, Binance and OKEx.
All three potential places for crypto market in Europe reflects the trend in cryptocurrency industry which is now worldwide and ever-evolving. If the EU approaches to the current trend toward the cryptocurrency and DLT, the market will grow faster than expected and can be the centre of the blockchain in the world.
Author: Jieun Lee