Reports indicate France intends to institute stricter regulations regarding registering cryptocurrencies in January 2024. The National Assembly and the Senate of France will vote to support this national agenda item, which favors using digital currencies.
A special parliamentary committee unanimously approved (1) the language of the registration rule. The next stage is to seek permission from the Senate, which is a procedure that will take place on February 16th.
After receiving approval from the Senate, the document would require endorsement from the National Assembly of France before the end of this month.
France was clear in its objectives about the anticipated registration requirements that crypto currency companies must conform to by January next year.
New Crypto License Seekers Have to Comply With Stricter Regulations
According to the new French registration plan, businesses registering for the first time to engage in crypto-related activities may be required to adhere to extra regulations.
As stated in the language above from the congressional Joint Committee, these regulations pertain to internal controls and cyber security and conflicts of interest.
Nevertheless, despite the seeming thoroughness of the current criteria, they are an improvement over the prior onerous posture adopted by the French Senate. Because of this stance, all newly applying businesses were compelled to look into obtaining a license.
The fact that no operator has been awarded a license up to this point is indicative of how laborious the process may be. Applying for a crypto license in France now includes inquiries into the applicant's company history and financial resources.
Companies could register with the Financial Markets Authority if they want to comply with the French crypto currency legislation. This registration would prove that the organization complies with fundamental guidelines for preventing money laundering and governance.
Crypto Lobby Group ADAN's Views
The President of ADAN, Faustine Fleuret, believes that the strengthened crypto regulation is a more realistic approach than the one proposed by the French Senate.
She did warn that one of the specified requirements, which calls for highly advanced and secure information technology systems, would provide some difficulties.
Fleuret thinks that it may be challenging for smaller enterprises to overcome these challenges and for regulators to command them effectively.
After the unexpected collapse of FTX in November of 2017, Senator Hervé Murray of France suggested that the country's crypto regulations be more stringent. Murray made the following observations at the time:
The recent bankruptcy of FTX has brought to light the inherent danger associated with any investment in crypto assets, particularly when the firm in question operates outside of any form of regulation.
In addition, the purpose of this concept was to close any potential compliance gaps that the adoption of new European Union regulations may have caused. Several European councils came together in October 2017 to endorse these guidelines, collectively referred to as the Markets in Crypto Assets legislation (MiCA).
In addition to increasing openness on crypto operations, crypto issuers must produce a transparent "white paper" on their crypto assets. In addition to that, the measure includes a requirement that stablecoin enterprises fulfill certain capital criteria.