Setting Up a Crypto Exchange Business in Malta Under MiCA Regulation

Setting up a crypto exchange in Malta isn’t about finding a loophole or jumping through hoops. It’s about building a business that can operate legally across the entire European Union - and that starts with one thing: a MiCA license. If you’re thinking about launching a crypto exchange, Malta isn’t just another option. It’s one of the few places in the world where you can get a license that works in all 27 EU countries. But it’s not cheap, it’s not fast, and it’s not easy. The rules are strict, the paperwork is heavy, and the bar is high. But for serious operators, it’s worth it.

Why Malta? The EU Passport Advantage

Malta’s biggest draw isn’t its beaches or its tax rates - it’s the EU passport. Once you get your MiCA license from the Malta Financial Services Authority (MFSA), you don’t need to apply for separate licenses in Germany, France, Spain, or the Netherlands. You can offer exchange, custody, and other crypto services across the whole EU with one approval. That’s huge. Other countries like Switzerland or Singapore may have simpler rules, but they don’t give you automatic access to 450 million people. Malta does.

This passporting right isn’t theoretical. Gate Technology Ltd got its MiCA license on September 1, 2025, and immediately started the process of expanding into other EU markets. That’s the model: get licensed in Malta, then scale across Europe. No more dealing with 27 different regulators. No more conflicting rules. Just one license, one compliance system, one operational setup.

What MiCA Actually Covers

MiCA isn’t just a license for trading Bitcoin. It’s a full regulatory framework that defines what you can and can’t do. There are three main types of entities covered:

• Crypto-asset service providers (CASPs) - these are exchanges, wallet providers, and custodians. If you’re letting people trade crypto or hold it for them, this is you.
• Issuers of asset-referenced tokens (ARTs) - stablecoins tied to fiat currencies or other assets, like EUR or gold.
• Issuers of electronic money tokens (EMTs) - digital tokens that function like electronic money, often used for payments.

If you’re running a crypto exchange, you’re almost certainly a CASP. That means you need to meet strict requirements around governance, security, capital, and transparency. You can’t just set up a website and start accepting deposits. You need a board, a compliance officer, a risk manager, and documented procedures for everything from KYC to cold storage.

The Licensing Process: What You Need to Submit

Getting licensed isn’t a form you fill out online. It’s a multi-month project that requires serious resources. Here’s what the MFSA expects:

• Business plan - detailed projections, target markets, revenue models, and growth strategy. Not a one-pager. Think 50+ pages.
• Governance structure - clear roles for directors, compliance officers, and AML staff. No vague titles. Names, responsibilities, and qualifications must be listed.
• Financial resources - you need to prove you have enough capital to cover risks. Minimum is €125,000, but most applicants show much more. The MFSA looks at your projected volume, user count, and potential losses.
• Cybersecurity plan - encryption standards, penetration testing reports, incident response protocols, and audit trails. You need to show you’ve thought about hacks, insider threats, and system failures.
• Risk management policy - how you identify, assess, and mitigate operational, financial, and reputational risks. This includes how you handle market volatility, liquidity crunches, and regulatory changes.
• AML/KYC procedures - your system for verifying users, monitoring transactions, and reporting suspicious activity. You must integrate with EU-wide tools like the EBA’s AML database.

There’s no official timeline, but most successful applicants take 6 to 12 months to get approved. The MFSA doesn’t rush this. They ask follow-up questions. They request revisions. They delay if anything looks unclear. You need patience and a team that knows exactly what they’re doing.

Costs: It’s Not Just the License Fee

The license application fee is €10,000. That’s the easy part. The real cost comes from building the infrastructure to meet MiCA’s standards.

• Legal and compliance consultants - expect €150,000 to €300,000 for help with documentation, drafting policies, and navigating MFSA reviews.
• Technology and security - secure custody solutions, multi-signature wallets, cold storage systems, and audit logs can cost another €200,000+.
• Staffing - you’ll need at least a CEO, CCO, CTO, AML officer, and compliance analyst. Salaries in Malta for these roles start at €70,000-€120,000 per year.
• Operational overhead - office space, insurance, ongoing audits, and regulatory reporting add another €50,000-€100,000 annually.

Total startup costs? Most serious operators budget between €500,000 and €1 million before they even open their doors. Smaller players often can’t make it. That’s why the MFSA has seen mostly established firms apply - companies like Gate Technology, Kraken, and Bitpanda. If you’re a solo founder with $50,000, you’re not ready for Malta.

Tax Rules: 35% Capital Gains, But With a Twist

Malta’s corporate tax rate is 35%, which sounds high - until you understand how it works. For crypto exchanges, profits from trading are treated as capital gains. But here’s the catch: Malta has a refund system. If you’re a Maltese company with shareholders outside Malta, you can get up to 6/7 of the tax refunded. That means your effective tax rate can drop to around 5%.

Plus, Malta has over 70 double taxation treaties. If your users are in the U.S., Canada, or Japan, you won’t get hit with extra taxes on cross-border transactions. That’s a huge advantage over countries like Germany or France, where crypto profits are taxed at higher rates with no refund system.

Don’t assume the tax rules are simple. You need a local accountant who understands crypto accounting under MiCA. Transactions must be tracked by timestamp, value in EUR, and user identity. The MFSA audits these records. Mess this up, and you risk losing your license.

Who’s Already Doing It?

The success stories aren’t hypothetical. Gate Technology Ltd got licensed in September 2025 - the first major exchange to do so under MiCA. Their CEO, Giovanni Cunti, said the license gave them the credibility to expand into new markets without facing regulatory pushback. Other big names like Coinbase and Kraken are also applying. That’s not a coincidence. These companies didn’t pick Malta because it’s easy. They picked it because it’s the only place that gives them EU-wide legitimacy.

Smaller operators are rare. The MFSA doesn’t reject applications outright - but they do delay them. If your governance structure is weak, your security plan is generic, or your financial projections are unrealistic, you’ll get feedback asking for revisions. Many applicants give up after the third round of questions. The ones that succeed have spent years preparing.

The Hidden Challenges

Even with a license, you’re not done. MiCA is evolving. The European Securities and Markets Authority (ESMA) keeps issuing guidance. The MFSA updates its rules every few months. You need a full-time compliance officer just to track changes.

Also, there’s no public database of approved applicants. You can’t look up who’s licensed. That means you can’t easily benchmark your application against others. You’re flying blind. The only way to know what works is to hire people who’ve done it before.

And if something goes wrong - a hack, a regulatory complaint, a failed audit - the MFSA has a dedicated Crypto-Assets portal for reporting issues. But they don’t take excuses. If you’re not prepared, you’ll lose your license. Fast.

Is Malta Right for You?

Malta isn’t for everyone. If you’re a small startup trying to launch a quick crypto exchange for niche users, skip it. Go to a jurisdiction with lighter rules. But if you’re serious about building a long-term, EU-wide crypto business - one that can attract institutional clients, partner with banks, and scale safely - then Malta is the only real option.

You need money. You need expertise. You need patience. But if you have those, you get something no other country can match: legal access to the entire European market under one clear, enforceable rulebook. That’s worth the cost. That’s worth the wait. That’s what makes Malta the center of gravity for serious crypto exchanges in Europe.