On Monday April 15, 2019, the French Finance Minister Bruno Le Maire announced French plans to encourage other EU members to adopt a regulatory framework on cryptocurrencies similar to the one France adopted the week before. The announcement was made at an event on blockchain technology in Paris.
Last week, the French parliament approved a law that included rules intended to tempt cryptocurrency traders and issuers to have France as their base, through a combination of official recognition and the existance of regulatory framework.
A main reason for France’s eagerness to attract cryptocurrency issuers and traders is the government’s wish to be able to gain tax revenue from the cryptocurrency sector.
According to an article published by Reuters on April 15, 2019, Bruno Le Maire has stated that “I will propose to my European partners that we set up a single regulatory framework on crypto-assets inspired by the French experience,” adding that ”Our model is the right one”.
In most parts ofthe world, cryptocurrencies are still either unregulated, outright prohibited or existing in a legal twilight-zone. The French government’s new cryptocurrency bill is the first of its kind adopted by a major nation.
France is hoping for cryptocurrency players to get regulated and pay taxes
The new French bill on cryptocurrency demands that cryptocurrency players based in France must obtained a special certification. Also, cryptocurrency issuers, traders, custodians and investors all have to pay taxes on profits obtained in the cryptocurrency sector.
One of the specific goals of the new regulation is to establish a market i Paris for companies who wish to raise capital through cryptocurrencies.
The new regulation is also offering increased trader protection by making it mandatory for the issuer of a cryptocurrency to be known to the French authorities. The same rule applies to those who wish to run a trading platforms.
Last but definitely not least, the new French bill stipulates that cryptocurrency will be subject to the same anti-money laundering laws as traditional currency. This could raise some serious concerns for cryptocurrencies traders who wish to remain anonymous.
European Commission has launched feasibility study
As France is pushing its fellow European countries to nationally adopt French-style cryptocurrency laws, we might also be able to see something happening on the European Union level in the future.
A feasibility study was recently launched by the European Commission, where the aim is to study how the regulate cryptocurrency markets.
IIn January, a European Banking Authority (EBA) report recommended further research into cryptocurrencies and revealed that they will perform ”a number of actions” relating to the cryptocurrency sector in 2019. These actions include developing a common monitoring template to be used by institutions, payment institutions and electronic money institutions to monitor crypto-asset trading, assets the business practices for cryptocurrency advertising, and continue to monitor.