The Malta Financial Services Authority (MFSA) is presently reviewing requests to revise the “regulatory treatment” of Non-Fungible Tokens (NFTs) inside its Virtual Financial Assets Framework. 

Under the present regulatory framework, NFTs are included inside the scope of the Virtual Financial Assets Act, which additionally contains digital tokens, digital monetary belongings, digital cash, and all monetary devices constructed, or depending on, Distributed Ledger Technology (DLT).

However, the MFSA is proposing to have NFTs faraway from the Virtual Financial Assets framework since they’re distinctive and nonfungible and due to this fact incapable of getting used as funds for items and companies, or for funding functions. 

According to the MFSA, “the inclusion of such belongings inside the scope of the VFA framework might run counter to the spirit of the Act, which sought to regulate investment-type companies provided in relation to VFAs falling exterior the scope of current conventional monetary service asset classes. “

The governing authority is presently inviting suggestions from stakeholders earlier than formally implementing these new revisions into its framework. 

Related: Chinese courtroom says NFTs are digital property protected by regulation

In November, Cointelegraph reported that Malta was main the way in which in Southern Europe with regard to cryptocurrency regulation. 

In 2018, the Maltese parliament enacted three legal guidelines establishing a complete regulatory framework for blockchain and digital currencies. The Virtual Financial Assets Act regulates the sphere of preliminary coin choices, digital belongings, digital currencies, and associated companies, whereas the Innovative Technological Arrangements and Services Act permits the Malta Digital Innovation Authority to oversee the registration of know-how service suppliers.

The nation’s present monetary regulatory framework acknowledges 4 distinct classes of digital belongings, topic to totally different units of guidelines: digital cash, monetary devices, digital (utility) tokens and digital monetary belongings (VFAs).

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