Malta's blockchain strategy

The Maltese cabinet has approved the first draft of a national strategy to promote blockchain technology - the platform that underpins the Bitcoin cryptocurrency and other fintech solutions. Malta's strategy has the single and focused purpose of making Malta one of the first countries in the world to embrace blockchain and jump on the bandwagon of the new economy. The plan is for Malta to pioneer a change at EU level, with the goal of dubbing the EU as the 'Bitcoin continent'. The draft strategy is currently on tables, for public consultation.

Prime Minister Dr Joseph Muscat said: "This is not just about Bitcoin... I also look forward to seeing blockchain technology implemented in the Lands Registry and the national health registries... Malta can be a global trail-blazer in this regard."

Malta has sought to create favourable environments for all sorts of innovation and avant-garde technology. Now it is doing the same for blockchain. Member of Parliament Silvio Schembri said "We should aim to have the world's best environment for the development and commercialisation of Fintech models and disruptive innovation... The government should ensure that Malta has the appropriate regulatory framework, the right tax system and the best infrastructure to support this ambition."

Malta intends to ride on its unique geographical position, mild climate, skilled labour force and entrepreneurial spirit to serve as a test market for new sectors, and foreign companies can trial their new technologies and products locally. The country has successful, solid industry sectors like the financial services, information technology and igaming, that can all tap into blockchain to improve their operations and service their customers, making the local market ripe for blockchain.

Malta blockchain initiatives

It is envisaged that in terms of popularity the use of blockchain technology will soon explode, as the internet did in the 1990s when web browsers were introduced. However, Malta is not only keeping up but is already breaking new grounds. A number of important institutions have set up blockchain task forces and think tanks that are busy working on skills, research, projects and regulation, among which are the Malta Financial Services Authority and the Malta Stock Exchange. The Malta Information Technology Agency is setting up its own blockchain hub while the Ministry of Education and Employment has signed a memorandum of understanding with Learning Machine Group (LMG), on digital education. The Malta Gaming Authority, in the meantime, is discussing a national betting exchange as well as the inception of a European Gaming Institute that will provide targeted and sector-specific training.

These collective efforts will result in the creation of a blockchain eco-system in Malta, which will eventually underpin the deployment of platforms, processes, applications and solutions with a far reach across industries.

Blockchain defined

Blockchain offers a safe, efficient and cost effective means recording and confirming transactions through a system based on a secure ledger that operates on an accepted protocol. Participants make use of technology based on peer-to-peer verification and hold complete and historic records of all transactions. This creates a de-centralised clearing house, doing away with the mediation of banks, financial institutions, verification authorities and other intermediaries. Blockchain's potential centres around areas such as record keeping, trade verification, clearing and settlement.