France should adopt a licensing regime for crypto-currency service providers, the head of the country’s central bank has suggested. According to the executive, the need for increased regulatory oversight stems from the “mess” that has plagued the sector over the past year.
License should replace registration for crypto-currency companies in France, according to Governor François Villeroy de Galhau.
Bank of France Governor François Villeroy de Galhau has called for stricter regulatory requirements for crypto-currency businesses. A license should be introduced in place of the current registration in response to the recent volatility of the sector, he insisted.
François Villeroy de Galhau also believes that Paris should not hesitate to act even before upcoming EU regulations come into effect and make French government licensing mandatory for digital asset service providers (DASPs), Bloomberg reports.
About 60 platforms working with crypto-currencies have so far registered with the French financial markets authority, the Autorité des Marchés Financiers (AMF), including global players such as Binance, the world’s largest crypto-currency exchange.
Licenses are still optional and there are no licensees yet among the digital asset service 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 conviction: it is desirable that France move as quickly as possible to a mandatory DASP license, rather than a simple registration.
DASPs seeking a license are required by the AMF to meet certain standards in terms of organization, available financial resources and business conduct, the report notes.
The governor’s proposal comes after key EU institutions and member states reached agreement last summer on new legislation for crypto asset markets (MiCA) and achieved consensus on a set of new anti-money laundering rules for the sector.
The regulatory package is expected to go into effect in 2023, but companies will have another 12 to 18 months to comply. Brussels also wants to require platforms handling crypto-currency transactions for EU residents to make declarations to EU tax authorities.