Initial Coin Offerings (ICOs) are defined, under Maltese Laws, as Initial Virtual Financial Asset Offerings (IVFAOs). Issuers of VFAs are subject to the Virtual Financial Assets (VFA) Act and the rules found in Chapter 2 of the Virtual Financial Assets Rulebook, entitled ‘Virtual Financial Assets Rules for Issuers of Virtual Financial Assets’, and thus must adhere to the general high-level principles found therein when carrying out their function. This includes, inter alia, performing duties in an ethical manner, acting honestly, fairly and professionally, whilst considering the investors’ best interests at all times.
The starting point in launching an IVFAO in Malta should always be the determination and classification of the token in question. Promoters can only opt for an IVFAO under the VFA Act if the token in question qualifies as a VFA and such determination has to be endorsed by the VFA Agent.
In order to issue a VFA in or from within Malta, an Issuer does not need a license, but must, through a VFA Agent licensed in Malta, register a Whitepaper with the MFSA, in addition to adhering to other mandatory conditions. Once the Whitepaper is registered, the Issuer can either launch the VFA or proceed with the admission of the VFA to trading on a Distributed Ledger Technology (DLT) exchange.