France needs to adopt a licensing scheme for cryptocurrency service providers, the country’s central bank official has suggested. According to the manager, the need for increased legislative oversight stems from the “disorder” that has prevailed in the sector over the past year.
The license should replace registration for cryptocurrency companies in France, according to Governor Francois Villeroy de Galhau.
The governor of the Banque de France, François Villeroy de Galhau, has called for cryptocurrency companies to be subject to stricter legal requirements. A license should be introduced in place of the current registration in response to recent volatility in the sector, he insisted.
François Villeroy de Galhau also believes that Paris should not hesitate to act even before the next EU rules come into force and make it mandatory to obtain licenses from the French government for digital asset providers (DASP), reports Bloomberg.
About 60 platforms working with cryptocurrencies have so far registered with the Autorité des Marchés Financiers (AMF), the French financial market authority, including global players such as Binance, the largest cryptocurrency exchange in the world.
Licenses are still optional and there are no licensees yet among digital asset providers registered in France. Speaking to representatives of the financial sector on Thursday, François Villeroy de Galhau said:
All this mess in 2022 feeds a simple belief: it is desirable that France move as soon as possible to a compulsory license of DASP, rather than a simple registration.
Providers of digital assets wishing to obtain a license are required by the AMF to meet certain standards in terms of organization, available financial resources and conduct, the report notes.
The governor’s proposal comes after key EU institutions and member states last summer agreed on new legislation on Crypto Asset Markets (MiCA) and reached consensus on a package of new anti-money laundering rules for the sector.
The regulatory package is due to come into effect in 2023, but companies still have 12 to 18 months to comply. Brussels also wants to require platforms that process cryptocurrency transactions for EU residents to report to EU tax authorities.