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Crypto Exchange

The VFAs regulated by the VFAA are classified into four classes. Crypto-exchanges fall under category four, which covers all provisions of VFA service and control or holding of clients cash in relation with providing a VFA service.


The timeline between the engagement until the issuance of the license is expected to take 3 - 6 months and involves:


  • Engagement

  • Drafting the letter of intent, which includes a business description and its proposed structure

  • Request a preliminary meeting with MFSA

  • Preparing an application and other supporting documentation

  • Submitting an application to MFSA

  • MFSA reviews the application

  • An in-principle approval is issued

  • Fulfilling all the pre-licensing conditions

  • The issue of licenses

Crypto-exchange applicants require a class 4 VFAA license for operations.

Ongoing Obligations

VFA service providers have several ongoing obligations including the following:

  • Organisational requirements that involve setting up a board of directors or administrators, formulating governance policies, having risk management and compliance measures and having measures to safeguard clients’ investments.

  • Prudential requirements that cover own funds, liquidity, initial share capital, and ongoing capital and fixed overhead requirements

  • Obligations on the conduct of business that covers how to regulate conflict of interest, sales procedures and the way clients' orders are executed

  • Keeping records, appointing an auditor, reporting and disclosure requirement.

  • Procedures on:

    • order marching and listing criteria

    • settlement, custody and suspension

    • removal of coins, utilities or financial instruments from trading.

Governance & Control

Exchanges shall submit an external auditor’s report at least once a year to the Competent Authority on the adequacy of the exchange’s arrangements.


Every VFA Exchange must put in place governance arrangements to safeguard customer assets. The VFA exchange shall appoint an officer who has sufficient skill and authority to be responsible for matters relating to compliance of the exchange and obligations on safeguarding customer assets.

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