A cryptocurrency exchange has recently chosen Malta as its European center and has received preliminary approval from the Malta Financial Services Authority (MFSA) for an Investment Firm license.
This license will enable the exchange to provide regulated options and futures trading, which includes contracts for difference (CFD) instruments, across the European Economic Area (EEA) under the Markets in Financial Instruments Directive (MiFID II). An official statement noted that the platform plans to roll out perpetual futures contracts, which have no expiry date, throughout the EU.
The MiFID II license is an essential component of the exchange’s strategy for European expansion, facilitating a broader range of services for both institutional and retail clients. The growing interest in cryptocurrency derivatives, especially from institutional investors, has been significant in recent years as cryptocurrencies evolve into a recognized asset class. The exchange is focused on delivering high-quality offerings tailored to the needs of diverse investors.
This movement towards derivatives within the cryptocurrency sector is not isolated. Other exchanges have also received MiFID licenses to provide derivatives across the EEA. For instance, a well-known exchange recently acquired the MiFID II license by purchasing the Cyprus-based unit of another firm that had previously offered CFD trading. Another prominent exchange has also secured a similar license through the acquisition of a different Cypriot company.
While many of these companies are currently focused on offering cryptocurrency perpetual futures, it is anticipated that they may explore the CFD market as well. A cryptocurrency company has already demonstrated this potential by acquiring a CFD broker in Australia, indicating that trading such instruments could become an integral part of their service offerings.
The exchange’s new license in Malta adds to its existing licenses, which include a Virtual Financial Assets (VFA) Service License—allowing it to operate under the Markets in Crypto-Assets (MiCA) framework—as well as a similar license in France. However, previous licenses did not permit the exchange to offer crypto derivatives, which is why obtaining the MiFID II license is crucial.
As the cryptocurrency market continues to mature and attract institutional interest, the focus on providing advanced financial products like derivatives is likely to deepen. The commitment of various exchanges to offer top-tier services for both institutional and retail investors highlights the evolving landscape of crypto trading and investment opportunities.
In summary, plans for expansion into the European market through the acquisition of necessary licenses point to a broader trend within the cryptocurrency space, where exchanges are increasingly looking to diversify their financial products and engage in derivative markets as part of their growth strategies. This evolution reflects the significant maturation of the cryptocurrency asset class and ongoing efforts to meet the demands of a growing investor base.