Cryptocurrency & Blockchain Business

Malta: MFSA is unaware of Founders ‘Bank’ advertising itself as a Bank

The financial services watchdog said it was not aware of any adverts by a blockchain company marketing itself as a “bank”.

On June 12, the government said a company called Founders Bank would be the world’s first decentralised and community-owned bank, which was awaiting a licence and planned to launch in the first half of 2019. According to the Banking Act, companies without a banking licence can only market themselves as a bank after obtaining written permission from the Malta Financial Services Authority.

“What we are aware of are media articles mentioning their plans to set up a blockchain-based bank servicing technology and cryptocurrency businesses.

“Any applications for this type of bank will have to follow all the MFSA’s on-boarding procedure,” a spokesman for the regulator said.

When it was pointed out that Founders Bank was clearly advertising itself as a bank on its website and in a blog post, the spokesman said the MFSA had nothing to add.

Founders Bank said in the blog post it would focus on serving tech and crypto businesses and would offer top-tier banking solutions.

The company said users would be able to access their accounts from both the mobile and desktop web applications and use them directly with credit cards issued by Founders Bank.

Founders Bank did not reply to a request for comment.

The Banking Act says

12(1) Subject to sub-articles (2) and (3), save with the written permission of the competent authority, no person other than a credit institution with a current licence may use the word “bank” or any of its derivatives or other words as may indicate or purport to indicate the carrying on of the business of banking in any language in the description or title under which such person is carrying on business, or make any such use on any letter paper, in any notice or advertisement, or in any other similar manner.

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