Officials in France have been calling for stringent crypto laws and regulations for the last few weeks. However, the country’s National Assembly has yet to take the decision on Tuesday evening. Meanwhile, a new regulatory regime in France on crypto firms will also vote in the Assembly. 

Before Eurpoe-wide rules come into effect, the French Assembly will discuss and debate whether crypto companies in France should follow stringent licensing protocols in the future.

European Union’s nationwide crypto regulation will come into effect towards the end of 2024. Until then, the legislators in France will discuss whether to impose mandatory laws for crypto firm licensing or not. 

The proposal for mandate licensing initially came from social-liberal Senator Herve Maurey, who asked to impose the mandatory licensing law by the October of 2023. This shook the crypto industry in France as, at the moment, the hard-to-obtain accreditation is optional.

In a text mentioning his amendment proposal to a broader bill transposing EU law, he wrote, “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.” Weighing what Maurey has proposed, the French National Assembly will also consider two other important factors before taking the decision. One is to move the deadline for crypto firms to licensing back; the second is to replace the present mandatory licensing registration law with a simpler one. 

Currently, in France, crypto firms do not prefer taking the licensing but opt to register companies with the financial regulator, the Financial Markets Authority (AMF). Currently, only 60 companies own the license, and according to the French Government, only they are working as per the government’s anti-money laundering laws.

To accelerate the licensing, a spokesperson of AMF said, “The resources allocated by the AMF to the process of these files are constantly increasing, and the AMF will continue to mobilize the resources necessary to carry out this mission.”

For companies to get licensing from AMF, they need to have minimum equity, secure liability insurance and put down internal control to align with proper cybersecurity laws and other organizational requirements.  It can be difficult for any crypto firm to obtain all these requirements as no one has yet.

AMF Chair Marie-Anne Barbat-Layani said, “The crypto universe must now make a clear choice to embrace regulation and investor protection. This is in its own interest because one black sheep can easily bring an entire industry into disrepute. “The AMF, like the French Parliament, is calling for an acceleration of the transition to mandatory registration for service providers that are currently not registered.”

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