France welcomes US crypto firms fleeing regulatory crackdown
French officials are extending a warm invitation to American crypto companies seeking a more predictable regulatory environment amidst the uncertainty and crackdown in the United States.
Currently, France is home to approximately 74 registered crypto companies, and this number is expected to grow further. As the European Union’s Markets in Crypto Assets (MiCA) rules were recently approved by EU ministers, a final round of firms is seeking to anticipate the implementation of these regulations. With a regulatory framework that offers relative stability and a supportive ecosystem, the number of registered crypto companies in France could potentially surge to 100.
“In France, we are proud to be pioneers with the crypto service asset provider regime, known as PSAN, that was legislated in 2019. If American players want to benefit, in the very short term, from the French regime, and from the start of 2025 from European arrangements, clearly they are welcome. We have good relations and discussions with our U.S. counterparts,” said Benoît de Juvigny, Secretary General of the Autorité des marchés financiers (AMF).
Amidst the evolving regulatory landscape in the United States, characterized by increased scrutiny from the Securities and Exchange Commission (SEC), the offer from France may indeed be alluring to crypto firms. Circle, the issuer of the second-largest stablecoin by market capitalization, is already seeking to get a dual registration in France as it aims to on-shore its flagship product for the European market – EUROC – a reserve-backed stablecoin.
Circle is the latest to join the list of crypto firms that have scored a major regulatory approval in France, and it follows the steps of Binance and Crypto.com. In recent months, brokerage firm eToro and Digital Currency Group’s Luno have also registered with France’s AMF.
Despite these claims, cryptocurrency firms will be obliged to get a fully-fledged license to operate in France as of January 2024 even before the upcoming EU regulations take effect. The head of central bank also supports the proposal of some lawmakers that would do away with a grace period that the country offers to crypto platforms.
Bank of France governor has called on lawmakers to start working on fresh crypto regulations to protect the financial system after the collapse of the FTX exchange. President of the European Central Bank, Christine Lagarde, also called for MiCA II to regulate activities related to crypto asset-staking and lending. The term refers to an additional legislation building on the work lawmakers did for the original bill.
At present, crypto platforms are allowed to operate in the country without a full license until 2026, meaning they can provide their services with minimal checks.
