Malta to Develop AI Strategy Following Success as ‘Blockchain Island’

Malta has launched a government task force to develop a national artificial intelligence strategy.

The Maltese government has announced the formation of a taskforce to develop a national artificial intelligence (AI) strategy, Cointelegraph reports Tuesday, Nov. 1 from the Malta Blockchain Summit.

The Junior Minister for Financial services, Digital economy and Innovation, Silvio Schembri announced the launch of the governmental initiative “Malta.ai,” stating that Malta is aiming to become a top AI nation. He said that the country would develop a friendly regulatory environment for AI much in the same way as it has done for blockchain technology:

“After successfully positioning Malta as the ‘Blockchain Island,’ by being the first in the world to regulate DLT (distributed ledger technology) products and services, we now would like to position Malta amongst the top 10 countries in the world with an artificial intelligence policy.”

The government has already launched a website for its national AI strategy. According to official statements at the Malta Blockchain Summit, AI projects will be monitored by the Malta Digital Innovation Authority — the same organization that monitors DLT. The government’s objectives are:

“…to dialogue with stakeholders, to build awareness of the key topics and issues that will inform a national AI Framework, consult on a policy that considers for ethically aligned, transparent and socially responsible AI, identify regulatory and fiscal measures to strengthen Malta’s appeal as a hub for foreign investment in this sector and identify the underlying skill base and infrastructure needed to support AI.”

Malta.ai will collaborate with SingularityNET, a decentralized marketplace for AI services, in a pilot project to “explore a citizenship test for robots in the process of drafting new regulation for AI.”

SingularityNET, which is working with renowned robot Sophia built by Hong Kong-based Hanson Robotics, has launched its own AGI token, with a total market capitalization reaching nearly $33 million according to CoinMarketCap.

Malta has gained a reputation as a proactive and friendly jurisdiction for blockchain and crypto-related business. The government announced its intention to make the country a leader in DLT in February of this year.

In early July, the country’s Parliament passed three bills setting a clear regulatory framework and legal environment for both the crypto and blockchain industries. The country has since become a popular area for crypto-related startups, including global crypto exchanges like Binance, OKex, and BitPay.

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Crypto Markets See Hint of Green, Top Cryptos Keep Trading Sideways

Crypto markets see a hint of green today, with most gains under one percent.

Thursday, Nov. 1: crypto markets have seen a hint of green, with many of the top 20 cryptocurrencies seeing slight growth. The slight growth in markets follows a recent sell off on Monday, when the price of Bitcoin (BTC) dropped from $6,480 to as low as $6,344. While 19 out of the top 20 cryptocurrencies by market capitalization have seen some growth today, almost all of them are still firmly in the red over the past 7 days.

Market visualization from Coin360

The major cryptocurrency Bitcoin is up almost 0.9 percent over the past 24 hours, and is trading at $6,360 as of press time. Bitcoin has seen some volatility in the middle of the day; with an intraday high of $6,547 and a low of $6,311.

Bitcoin price 24-hour chart. Source: CoinMarketCap Bitcoin Price Index

Ethereum (ETH), the second cryptocurrency by market cap, is seeing similar growth, up around 0.7 percent over the 24 hour period. Ethereum is trading $198.70 at press time.

Ethereum price 24-hour chart. Source: CoinMarketCap Ethereum Price Index

Ripple (XRP) has seen more growth today, up 1.23 percent over the past 24 hours and trading at $0.453 at press time. Following the overall trend on the market, the third top cryptocurrency by market cap saw some growth earlier in the day, increasing as high as $0.456.

Ripple price 24-hour chart. Source: CoinMarketCap Ripple Price Index

After reaching as high as $210 billion earlier today, total market capitalization has been steadily fluctuating around $205 billion at press time. Daily trade volume has slightly decreased over the day, down to $10 billion from $11 billion as of press time.

Total market capitalization 24-hours chart. Source: CoinMarketCap

Yesterday, major U.S. multinational investment bank and financial services company Morgan Stanley released a report claiming that Bitcoin and other cryptocurrencies have been a “new institutional investment class” since 2017. According to the report, institutional investors are still considering crypto despite the persisting bear market this year.

In contrast, JPMorgan CEO Jamie Dimon recently expressed his ambivalence toward Bitcoin on the eve of its 10th anniversary, claiming that while he “didn’t want to be the spokesman against Bitcoin,” he does not “really give a sh*t.”

On Oct. 31, CEO of major crypto derivatives platform BitMEX Arthur Hayes said he believes that “crypto winter” could last for as long as 18 months, “based on previous experience” of low volatility and trading volumes. Amidst Bitcoin’s record low volatility, Fundstrat’s head of research Tom Lee recently stated that he was “pleasantly surprised” by the recent stability of BTC.

Original Article

Hong Kong Regulator Announces New Plans for Cryptocurrency Industry

The Securities and Futures Commission of Hong Kong has announced new plans to regulate the cryptocurrency industry. The regulator issued two circulars on Thursday outlining new rules for crypto exchanges as well as crypto asset portfolio managers, intermediaries, and fund distributors.

Also read: Yahoo! Japan Confirms Entrance Into the Crypto Space

New Regulatory Approach

Hong Kong Regulator Announces New Plans for Cryptocurrency IndustryThe Hong Kong Securities and Futures Commission (SFC) issued two circulars on Thursday concerning cryptocurrency regulations. The first outlines “a new approach which aims to bring virtual asset portfolio managers and distributors of virtual asset funds under its regulatory net,” the commission wrote. It also “sets out a conceptual framework for the potential regulation of virtual asset trading platforms.” The second document addresses intermediaries that distribute crypto funds.

Hong Kong Regulator Announces New Plans for Cryptocurrency IndustryThe SFC defines a virtual asset as “a digital representation of value, which is also known as ‘cryptocurrency’, ‘crypto-asset’ or ‘digital token’.”

Citing “significant risks virtual assets pose to investors,” the commission announced that it will “adopt new measures within its regulatory remit,” elaborating:

The SFC will impose licensing conditions on firms which manage or intend to manage portfolios investing in virtual assets.

In addition, the regulator noted that it will explore whether crypto exchanges “are suitable for regulation in the SFC regulatory sandbox.”

Risks Under Existing Law

Hong Kong Regulator Announces New Plans for Cryptocurrency IndustryIn the first document, the securities watchdog expressed concern over “the growing investor interest in gaining exposure to virtual assets via funds and unlicensed trading platform operators in Hong Kong.” The SFC explained that investors are not protected since the Securities and Futures Ordinance (SFO) currently does not apply to unregulated exchanges or portfolio managers, adding:

Under existing regulatory remits in Hong Kong, markets for virtual assets may not be subject to the oversight of the SFC if the virtual assets involved fall outside the legal definition of ‘securities’ or ‘futures contracts’ (or equivalent financial instruments).

The regulator proceeded to outline the “significant risks” associated with investing in crypto assets which it has identified such as volatility, liquidity, cybersecurity, safe custody of assets, market integrity, money laundering, terrorist financing, conflict of interest and fraud.

Licenses and Regulatory Sandbox

Under the new rules, crypto asset portfolio managers will be subject to the SFC’s supervision “irrespective of whether the crypto assets meet the definition of securities or futures contracts.”

Noting that firms which distribute funds that invest in crypto assets in Hong Kong will need to be licensed, the commission detailed:

Licence applicants and licensed corporations are required to inform the SFC if they are presently managing or planning to manage one or more portfolios that invest in virtual assets.

Hong Kong Regulator Announces New Plans for Cryptocurrency IndustryThe SFC will then evaluate whether the firm is capable of meeting the expected regulatory standards. If the firm does not comply with the proposed terms and conditions, its licensing application will be rejected. Licensed corporations failing to comply will be required to unwind their crypto portfolios within a reasonable period of time.

“If the SFC grants a licence to a qualified platform operator, it will impose appropriate licensing conditions and the operator will proceed to the next stage of the sandbox,” the regulator described. “This would typically mean more frequent reporting, monitoring and reviews,” the commission added, stating:

After a minimum 12-month period, the virtual asset trading platform operator may apply to the SFC for removal or variation of some licensing conditions and exit the sandbox. Licensing conditions (and terms and conditions) imposed in this stage would be made public in the usual way.

Crypto Asset Funds

Hong Kong Regulator Announces New Plans for Cryptocurrency IndustryThe second circular addresses both authorized and unauthorized intermediaries that distribute crypto funds. They are required to comply with the SFC’s Code of Conduct. “Specifically, intermediaries should ensure that the recommendation or solicitation made is suitable for clients in all circumstances,” the regulator emphasized.

Intermediaries should also provide their clients with all the necessary information to make informed investment decisions “in a clear and easily comprehensible manner.” Furthermore, the SFC explained that they must conduct due diligence on the fund manager, the fund itself, and the fund’s counterparties, noting:

Intermediaries are reminded to implement adequate systems and controls … before they engage in the distribution of virtual asset funds. Failure to do so may affect their fitness and properness to remain licensed or registered and may result in disciplinary action by the SFC.

What do you think of the SFC’s new rules to regulate the crypto industry in Hong Kong? Let us know in the comments section below.

Images courtesy of Shutterstock and Hong Kong SFC.

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