Malta’s dream of realizing the project that would turn it into Blockchain Island would have been thwarted by the disdain of the banks.
The ambitious project of „Blockchain Island“ devised in Malta, seems to have fallen into a phase of stagnation. The main reason behind this could be the refusal of the country’s retail banks to participate in joint ventures with technology companies.
The lack of innovative vision on the part of traditional banks has been the main obstacle, explained the Minister of Finance and Employment, Clyde Caruana. This is an attitude that he describes as „lack of willingness“, in the face of new technologies that could open the doors of the future to the small nation.
Malta is an island located in the Mediterranean Sea, between Sicily (Italy) and North Africa. Its main source of income is maritime trade and tourism. The latter focuses on the island’s rich ancient history. However, both businesses were hit hard in 2020 by the COVID-19 pandemic.
Why does the banking industry not want to participate in the Blockchain Island project?
Statements about the stalled „Blockchain Island“ project were made by a minister in a local environment. He highlighted the conservative nature of the island’s financial centers and explained that the success of the project depends on the participation of the banks.
However, these institutions must be totally convinced of the feasibility of the project, otherwise they will not show interest. In this case, few technology companies have managed to partner with banks in the country to advance this ambitious work.
In the interview, Caruana was very pessimistic about the project and mentioned that it is probably a closed chapter. „There will always be potential to carry out the project Corona Millionaire. But if we want to make it a reality, we must work more and the banks must be convinced that it is something that can happen,“ he said.
Another fact that increases pessimism about the feasibility of the project „Blockchain Island“, is the increasing restrictions on banks. In that sense, many of the financial institutions, reject the crypto currencies in the midst of an accelerated momentum in the fight against money laundering in Malta.
Banks feel threatened
Another aspect that could play against the project „Blockchain Island“, is that the banks could feel intimidated by what the Blockchain represents. This is accentuated by the position of some companies related to this technology, which do not hide their intentions to overthrow the old centralized financial system.
But the reactionary role of the Maltese banks is not only expressed in their reluctance to work with the Blockchain technology. In other sectors, they have also made their refusal to participate felt, which could mean for the Island, being left behind in technological terms with respect to other nations.
Recently, in Malta, some emerging industries presented a project to support research related to medical cannabis. In that case, in the same way, the bank showed more than disinterest, a contrary attitude.
At the same time, the minister stated that another factor that plays in favor of the omnipotence of the banks on the island is the lack of local skills. Companies dedicated to the development of Blockchain technology could be more independent if there was a technologically trained workforce within the country, he explained.
Regulations remain favorable
The „Blockchain Island“ project, despite its weak state, still has its doors open. It should be remembered that in 2018 the country’s parliament approved laws favorable to the development of Blockchain and other futuristic technologies.
With this advance, the offices of important exchanges and companies related to cryptomonies were established on the island, among them Binance and OKEx. However, early this year 2020, it became known that the outgoing government did not even grant a license to these crypt companies.
The new executive who has been governing the island since then, has given his word to remain friendly with this technological environment. However, progress has been slow. As a result, Malta, from being one of the most promising countries in the area, is now one of those marching in the last row.
Data to take into consideration
- The project „Blockchain Island“ in Malta could be doomed to failure due to the apathy of the banks.
- The country’s Minister of Finance and Employment, Clyde Caruana, was pessimistic about the future of the project.
- The banks could be afraid of the rhetoric of some Blockchain companies. They openly profess their intentions to overthrow the banks.
- This is not the first time that the country’s financial institutions have played a negative role in the diversification of the island’s industry.