Key Takeaways
- Malta’s rapid approval of crypto firms like OKX, Crypto.com, and now Gemini has sparked concern among EU regulators.
- Countries like Malta and Luxembourg are competing to attract major exchanges, with Luxembourg moving to license U.S. giant Coinbase.
- The European Securities and Markets Authority faces pressure to play a more assertive role.
Gemini and Coinbase are on the verge of gaining European Union licenses to operate in Malta and Luxembourg respectively, under the bloc’s new Markets in Crypto-Assets (MiCA) regulation, sources told Reuters .
The move comes shortly after Malta fast-tracked approvals for OKX and Crypto.com, which has raised questions from regulators about the speed at which licenses are being granted in the bloc.
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Malta Raises Concerns
Gemini, a crypto exchange founded by the Winklevoss twins in 2014, has sparked concerns from other national regulators over a potential crypto license.
Malta, the smallest country in Europe and a hotbed for digital assets, previously approved OKX and Crypto.com just weeks after MiCA was introduced.
Sources said the European Securities and Markets Authority (ESMA) is preparing to release a report criticising Malta’s licensing process.
An unidentified high-level regulator also told Reuters they were concerned about countries accepting licenses, where regulators have fewer staff.
Meanwhile, France’s AMF has spoken out against the ESMA’s lack of direct authority, which they say could lead to a “regulatory race to the bottom.”
A spokesperson from the Malta Financial Services Authority told the publication it was able to move fast due to past experience.
The regulator added that it had acquired an “in-depth understanding” over the years.
Coinbase to Luxembourg
Luxembourg has pushed back against claims that it has an easy approval process, as it gets closer to granting a licence to U.S. crypto giant Coinbase.
Coinbase told the publication it employed 200 in Europe and had invested in staff to make sure operations were safe, after a source highlighted the relatively small size of its planned operation in the country.
The move is seen as a significant setback for Ireland, where Coinbase has been based since 2018.
Ireland’s reputation with the crypto industry has taken a beating, partly due to Central Bank Governor Gabriel Makhlouf comparing the industry to a Ponzi scheme.
“The purchase of such products can be similar to purchasing a lottery ticket: you might win but you probably won’t,” Makhlouf wrote in a blog post . “And describing it as ‘investment’ is, needless to say, an abuse of the word; ‘Ponzi schemes’ might be more accurate.”
EU Battles
Malta’s fast-tracking of crypto licenses under MiCA has sparked a continental tug-of-war over who gets to host the industry’s biggest players.
Since MiCA came fully into effect in December 2024, exchanges can now obtain a licence in one EU country that grants the ability to operate freely across all 27 member states.
This passporting model has triggered a scramble among nations eager to anchor the next wave of crypto innovation.
Meanwhile, ESMA’s leadership is currently under debate.
ESMA head Verena Ross has called for expanded central oversight and raised questions internally about whether EU guardrails need strengthening.
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