Crypto

France gives crypto companies more time to comply

French lawmakers have taken a relaxed approach to crypto licensing in the country, giving operators more time to comply with new European standards.

The deputies of the National Assembly voted an amendment proposed by centrist politician Daniel Labaronne last night, which will allow existing crypto businesses to continue operating without a full license until the European Union’s historic crypto regulations come into effect.

France currently has a two-tier regime for crypto businesses. All operators must register as providers of crypto assets, but they do not have to obtain a full license, a process that requires higher levels of disclosure. While around sixty service providers have registered with the Autorité des marchés financiers (AMF), none have opted for full accreditation.

The amendment, however, requires any new market entrants to obtain a full license if they launch in 2024 or later.

In passing the amendment, lawmakers rejected a earlier amendment proposed in December by Senator Hervé Maurey. Maurey’s proposal would have required those players to begin the process of obtaining full clearance this year.

The move would have accelerated the French crypto’s adoption of new, higher standards expected to be imposed by the European Crypto Asset Markets (MiCAs), likely by 2026.

“This is a pragmatic decision aimed at striking the right balance between the flourishing of innovation in France and the safe environment for users in which it must necessarily take place,” said Faustine Fleuret, President- CEO of the French crypto industry association Adan. Decrypt by email. “It is also a message addressed to the industry on the exemplarity and professionalism expected of the actors on this path of harmonization of European regulations.”

Labaronne, who proposed the final amendment, said that while FTX’s bankruptcy underscored the need to protect investors, more time was needed to implement tougher rules.

Crypto in France

The passage of Labaronne’s amendment marks the end of several weeks of intense discussions between lawmakers and the crypto industry in France, a country that has so far shaped itself as a haven for cryptopreneurs.

Binance CEO Chanpeng “CZ” Zhao, whose crypto exchange was greenlit in France in May 2022, said that the country “is very well placed to be the leader of this industry in Europe”.

Crypto companies like Binance and Crypto.com will now have a bit more leeway until MiCA is applied.

The EU regulations package, which aims to unify the approach to crypto across the 27-nation bloc, is expected to going to vote this year.

If passed, the rules will then take another 18 months to apply.

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