France to End Favorable Treatment Given to Crypto Firms
- France operates a system where businesses can choose not to receive a full license but still operate in the country.
- About 50 registered businesses are currently functioning in France without receiving a full license from the Autorité des Marchés Financiers (AMF).
- The new policy will align France with the crypto-related policies of the European Union.
- The Emmanuel Macron administration is well known for its loud endorsement of the digital asset sector.
A French lawmaker has suggested harmonizing the nation’s legislation with impending EU regulation. As a result, France may require cryptocurrency companies to obtain a full license in order to operate there. Hervé Maurey, a senator who serves on the finance commission, proposed an amendment that would eliminate the favorable treatment France presently grants to cryptocurrency companies.
According to Maurey,
The recent bankruptcy of FTX has highlighted the risks inherent in any investment in crypto assets, especially when the company operates outside of any regulation. These concerns, including for financial players, are shared at the European Union level.
Crypto businesses are currently permitted to operate legally in France without a full license until 2026. However, the latest proposal, which the Senate approved last week and will be presented to the French parliament next year, would mandate that companies obtain a full license from the financial authority beginning in October 2023. The new policy will bring France into compliance with the EU’s Markets in Crypto Assets (MiCA) regulation.
The existing two-tier system in France requires businesses to register as providers of digital assets but then allows them the choice to obtain a complete license, which necessitates extensive transparency. Although about 60 providers have registered with the Autorité des Marchés Financiers (AMF), none have chosen full authorization. Thierry Philipponnat, an ex-member of the AMF board, slammed the present AMF regime for its weak investor protection, noting that it was “very light, if not non-existent.”
If the proposal is approved by the parliament, it would jeopardize France’s position as a crypto-friendly country, which has drawn businesses and top crypto firms to open offices there. Opposing groups believe the amendment proves that the country is forsaking its aim of being the center of European cryptocurrency activities.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
