François Villeroy de Galhau, governor of the French central bank, has called on the French authorities to do so take steps to quickly regulate the cryptocurrency market. In fact, he would like cryptocurrency companies to go under the compulsory licensing regime as soon as possible.
The governor of the Banque de France puts pressure
The latest events that have rocked the cryptocurrency industry, including the fall of FTX, have created a climate of distrust towards cryptocurrencies. Some personalities and institutions are calling for a boycott of digital currencies. Others want to impose drastic regulation like fiat currencies.
It is on this momentum that François Villeroy de Galhau, governor of the Banque de France, recently spoke. This was stated by the head of the banking institutionit was necessary to impose a system of compulsory licenses on cryptographic companies operating in France.
Given the current turmoil in the cryptocurrency market, he wants the action to happen sooner rather than later. Above all, he wants this measure to happen before the enactment of European-wide laws to regulate cryptography. For him, France should oblige local digital asset service providers to obtain an operating licence.
Regulatory before European laws
In a January 5 speech reported by BloombergGovernor of the Central Bank of France he confided that he did not want to wait for the draft law of the European Parliament (MiCA) to come into force. This project plans to regulate digital asset markets by establishing a cryptographic licensing system. It could potentially see the light of day in 2024.
For the moment, the French authorities carry out a simple registration of crypto companies with the Autorité des Marchés Financiers (AMF), which is not enough for François Villeroy de Galhau. His pretext is his desire to stop the disorder observed in the cryptocurrency industry in 2022.
Currently, the MFA has recorded the existence of 60 cryptographic companies on French territory. However, none of them are licensed as a Digital Asset Service Provider (DASP) although it is optional. The issuance of this license is subject to compliance with the company’s financing organization and conduct rules.
Before François Villeroy de Galhau’s intervention, a member of the Senate Finance Commission had already done so makes a proposal on cryptocurrencies. Indeed, Hervé Maurey proposed an amendment to remove the provision that cryptocurrency companies could operate without a license in France.
The clause the senator wants removed allows companies to operate without a license until 2026. The European Parliament will discuss it during deliberations starting in January 2023. This provision protects businesses even when the European MiCA bill enters into force by 2024.
The European Parliament has been examining the draft regulation of cryptocurrencies since 2020. In October 2022, the European Parliament’s Committee on Economic and Monetary Affairs has adopted the cryptographic framework defined during the work between the European Parliament, the Council of the EU and the European Commission. We will know the definitive version of the law in February after the vote to be held.