Only 39 Percent Pass Malta’s Cryptocurrency Exam for Financial Services Practitioners

Only 39 Percent Pass Malta’s Cryptocurrency Exam for Financial Services Practitioners

Regulation

The pass rate for the exam developed by the Maltese government for financial services practitioners seeking to obtain cryptocurrency agent certification is reportedly only 39 percent. The exam is part of the requirements mandated by the country’s newly established Virtual Financial Assets Act.

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

Low Pass Rate

Only 39 Percent Pass Malta’s Cryptocurrency Exam for Financial Services PractitionersUnder Malta’s Virtual Financial Assets (VFA) Act, practitioners who wish to act as agents in the field that includes cryptocurrencies and initial coin offerings (ICOs) must successfully complete a short training course and pass an exam.

Noting that the first exam took place in September, the Times of Malta reported on Thursday:

Nearly two-thirds of those applying for cryptocurrency agent certification failed the official assessment process despite last-second changes intended to boost the pass rate.

Only 39 Percent Pass Malta’s Cryptocurrency Exam for Financial Services PractitionersThe exam was set by the Malta Financial Services Authority (MFSA) and administered by the Institute of Financial Services Practitioners.

The news outlet quoted sources revealing that about 250 lawyers, accountants, and auditors took the exam, which consisted of a series of multiple choice questions. “Once the exam papers were graded, it became clear the pass rate was extremely low,” the publication conveyed, adding that “Even after the changes the pass rate was just 39 percent.”

License Required

According to the MFSA’s consultation document for VFA service providers, “any person who is providing a VFA service … shall within twelve months apply for a license with the competent authority in terms of Article 14 to the Act,” the CBS Group described.

Only 39 Percent Pass Malta’s Cryptocurrency Exam for Financial Services PractitionersThe MFSA wrote, “It has also become evident that certain industry players are not sufficiently prepared to register as VFA agents.” The regulator, therefore, proposes a number of additional rules for them to comply. They include increasing the initial and ongoing capital requirements as well as regulatory fees. In addition, the MFSA proposes “introducing a rigorous competence assessment” and “a mandatory requirement for Continuous Professional Education.”

The Times of Malta elaborated, “The VFA Act is one of three new laws forming part of the government’s ‘Blockchain Island’ strategy and which seek to regulate the blockchain and cryptocurrency sector,” adding that “It will enter into force in November.” Other than trading cryptocurrencies and issuing ICOs, the publication explained:

Companies looking to provide other virtual financial asset services, such as portfolio management or investment advice, also need an agent to apply for a licence.

What do you think of the low pass rate for the Maltese cryptocurrency agent certification exam? Let us know in the comments section below.


Images courtesy of Shutterstock and MFSA.


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SEC Establishes FinHub to Engage Public on Cryptocurrencies

The U.S. Securities and Exchange Commission (SEC) has announced the launch of the Strategic Hub for Innovation and Financial Technology (FinHub) to promote public engagement on fintech-related issues and initiatives, including blockchain technology and cryptocurrencies.SEC Launches FinHub Portal in Connection with the Issuance of Its DAO ReportFinHub, which replaces several internal working groups at the SEC, includes other areas involving the financial markets sector, including automated investment advice, digital marketplace financing, and artificial intelligence and machine learning.Acting as a portal for industry and the public, FinHub will publicize information regarding the agency’s initiatives and create a forum focusing on blockchain and digital assets, according to a press release.To be led by Valerie A. Szczepanik, senior advisor for digital assets and innovation and associate director in the SEC’s division of corporation finance, FinHub will also serve as liaison to other domestic and international regulators regarding cryptocurrencies and other issues, according to the entity chaired by Jay Clayton.“The SEC is committed to working with investors and market participants on new approaches to capital formation, market structure, and financial services, with an eye toward enhancing, and in no way reducing, investor protection,” he added. “The FinHub provides a central point of focus for our efforts to monitor and engage on innovations in the securities markets that hold promise, but which also require a flexible, prompt regulatory response to execute our mission.”The new SEC portal, FinHub, was established in connection with the issuance of DAO Report on July 25, 2017. The document defined ICO tokens as securities, which caused great concern for many players in the crypto space as they prepared to launch their own initial coin offerings. The SEC has also made it clear that the token sales during the ICOs don’t qualify as crowdfunding.“SEC staff across the agency have been engaged for some time in efforts to understand emerging technologies, communicate the agency’s stance on new issues, and facilitate beneficial innovations in the securities industry. By launching FinHub, we hope to provide a clear path for entrepreneurs, developers, and their advisers to engage with SEC staff, seek input, and test ideas”, said Szczepanik.The portal invites public input on matters such as fund innovation and crypto holdings, blockchain applications, and the listing of of VanEck SolidX Bitcoin Trust shares. The financial watchdog has been conservative regarding the entry of Bitcoin ETF applications.By August, the SEC denied nine applications from ProShares, Direxion, and GraniteShares via three recently published documents.Featured image from Shutterstock.

First Bitcoin Fraud Action Filed by the CFTC, Accused Ordered to Pay Over $2.5 Million

A  New York federal court has ordered Gelfman Blueprint, a Bitcoin-denominated hedge fund, and its CEO Nicholas Gelfman to pay over $2.5 million in civil monetary penalties and restitution in the first Bitcoin fraud action filed by the Commodity Futures Trading Commission (CFTC).CFTC First Bitcoin Fraud Action Results in $2.5 Million Penalty Over $600,000 Ponzi SchemeCFTC’s first anti-fraud enforcement action involving Bitcoin found that Gelfman and its firm operated a Bitcoin Ponzi scheme from 2014 to January 2016, according to a press release.The fraud was able to solicit over $600,000 from at least 80 customers. The customers’ funds were supposed to be placed in a pooled commodity fund using a high-frequency, algorithmic trading strategy called “Jigsaw,” which turned out to be fake.All performance reports were false, according to the CFTC, and payouts to GBI customers consisted of other customers’ misappropriated funds. James McDonald, the CFTC’s director of enforcement, promised to continue to enforce the law in the cryptocurrency arena.“This case marks yet another victory for the Commission in the virtual currency enforcement arena. As this string of cases shows, the CFTC is determined to identify bad actors in these virtual currency markets and hold them accountable. I’m grateful to the members of Enforcement’s Virtual Currency Task Force for their tireless work on these matters.”Law enforcement found that the defendant’s real trading account records revealed only infrequent and unprofitable trading. Gelfman tried to conceal the Ponzi scheme by staging a fake computer “hack” that supposedly caused the loss of nearly all funds.Gelfman and his firm are now ordered to pay, respectively, $492,064.53 and $554,734.48 in restitution to customers and $177,501 and $1,854,000 in civil monetary penalties, amounting to over $2.5 million. Moreover, the defendant is now banned from trading in the United States for life.The agency cautioned that orders requiring repayment of funds to victims may not result in the recovery of any money lost because the wrongdoers may not have sufficient funds or assets. The CFTC said it will continue to fight vigorously for the protection of customers and to ensure the wrongdoers are held accountable.In July 2018, the CFTC claimed a Bitcoin pool operator has fraudulently solicited almost $500,000 worth of Bitcoin from at least 127 individuals who expected to participate in a pooled investment vehicle for trading commodity interests.The regulator requires Dillon Michael Dean and his U.K.-registered company, The Entrepreneurs Headquarters Limited (TEH), to pay almost $500,000 in restitution to customers plus a sum of $1,497,792.12 civil monetary penalty, bringing the total amount owed to a hefty $2 million.Featured image from Shutterstock.