Binance, the world’s second largest cryptocurrency exchange by traded volume, has announced plans to create the first blockchain bank, which will be located on the island of Malta, according to Bloomberg.

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Silvio Schembri
Silvio Schembri

“We are honored to be chosen as the location of the first global community-owned bank,” said Silvio Schembri, junior minister for financial services, digital economy and innovation within the Office of the Prime Minister of Malta.

Binance has stated the goal of the project is to build the first decentralized, community-owned bank in the world.

Changpeng Zhao

Changpeng Zhao, CEO of Binance, expects his platform to profit from $500 million to $1 billion in 2018.

The pro-cryptocurrency island of Malta will be home of the future Founders Bank who will have a 5 percent stake together with other investors at a $155 million pre-money valuation, according to Bloomberg.

“This is fascinating, as a concept,” said Marc Ostwald, global strategist at ADM Investor Services International in London.

“Obviously, they’ll have to meet anti-money-laundering regulators. The question will be, how do regulators view this?”

Binance stated the equity-token sale would be conducted under German regulations in collaboration with one of Europe’s major stock exchanges later this year.

In June, Malta passed three laws encouraging blockchain-related companies to move to the Mediterranean island nation, just off the coast of Italy.

The bills “created a fertile environment for blockchain companies and cleared the uncertainties surrounding the market for decentralized assets,” according to an official statement from Binance.

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