France’s prudential supervision authority remains cautious with regard to crypto-assets

Maria Nikolova

The ACPR pushes for strict regulations for crypto-assets and the companies offering such products.

France’s Prudential Supervision and Resolution Authority (ACPR) has earlier today published its Annual Report for 2017, with the regulator striking a cautionary note with regard to all sorts of investments in cryptocurrencies.

The ACPR says it has been keeping a close eye on the surge of the so-called “crypto-assets”. Although the underlying blockchain technology offers grand perspectives, the investment in crypto-assets, which cannot be considered currencies, presents an elevated risk for the investors given the extreme volatility of such products. That is why, the ACPR and the Bank of France call for strict regulations of crypto-assets and the companies offering such products. Such regulations should be focused on security and to mitigate the risks of money laundering. Such a framework must, of course, be implemented at an international level.

The French regulator also notes the rise of scams involving crypto-assets.

The cautious stance voiced by the ACPR echoes that from the Annual report for 2017 issued by France’s financial markets authority AMF. In its report, AMF said the number of complaints about toxic financial products, such as Forex and binary options, fell in 2017. There were 566 complaints about binary options and Forex products received by the regulator in 2017, compared to 1,656 in 2015. The drop was 67% when compared to 2015 levels and 48% when compared to 2016 levels.

A new theme that has sparked investor concerns, according to AMF’s report, is Bitcoin. Following the volatility of Bitcoin’s prices in the fall of 2017, the regulator has noted a rise in the number of enquiries about cryptocurrencies. The regulator says that as the complaints about binary options and Forex, as well as diamond investments drop, those about cryptocurrencies rise.

In November 2017, AMF published a special guide entitled “Investing in Bitcoin: Caution!”. In the document, the regulator stresses that Bitcoin, as well as all other virtual currencies (there are more than 4,500 of them), do not imply any protection for investors, as they are not like fiat currencies. The regulator provides some clarifications useful to the general public, informing it that Bitcoin may not be accepted as a payment means everywhere and that euro is the official currency in France.

Special attention is paid to the risks associated with the hype created around Bitcoin, given that various media publications and advertisements tout the virtual currency as an incredible investment opportunity. AMF emphasizes that the risks of investing in Bitcoin are at least twice as high as those associated with trading of “typical” CFDs. Investment in Bitcoin requires certain tech, IT and financial knowledge, the watchdog notes. Particular caution is urged with regard to ICOs, as well as all sorts of “mining” offers.

Read this next

Institutional FX

Deutsche Bank goes live with its FX pricing and trade engine in Singapore

Deutsche Bank has gone live with its electronic foreign exchange pricing and trading engine in Singapore, where demand for currency trading among institutional players is on the rise.

Retail FX

CySEC extends the suspension of Depaho license until November 19

The Cyprus Securities and Exchange Commission (CySEC) has decided to extend further the suspension of the license of the Cyprus investment company Depaho Ltd, which operates the retail FX brands GTCM, FXGM and TRADEAPP.

Retail FX introduces QuantX, a tool to build automated portfolio

Multi-licensed broker has rolled out a new portfolio platform, QuantX, which uses a client’s risk tolerance assessment and other criteria to create fully customized investment portfolios.

Digital Assets

Ripple scores major win: Judge orders SEC to explain…a lot

The SEC is ordered to explain, among other things, how the Howie test applies to XRP, what is the status of Ether and Bitcoin, and the sale of XRP as investment contracts.

Retail FX

Trade CFDs on 900+ of the Biggest Companies this Earnings Season with HotForex

Traders with the internationally acclaimed multi-asset broker HotForex can trade CFDs on the stocks of over 900 companies during Earnings Season with tight spreads, flexible leverage, negative balance protection and the many other advantages that have made it an honest, open and transparent broker of choice to over 2.5 million traders around the world.  

Digital Assets

Polygon (MATIC) double spend bug yields $2 million bounty for developer

Polygon, the Layer 2 solution on top of Ethereum, has recently paid out the highest ever bug bounty in history to a whitehat developer Gerhard Wagner for pointing out a double-spend bug in the network which could have resulted in huge losses if it had been exploited.

Digital Assets

KuCoin aims to become largest social trading platform in crypto

KuCoin was founded in September 2017 and it currently provides Spot trading, Margin trading, P2P fiat trading, Futures trading, Staking, and Lending to its 8 million users in 207 countries.

Digital Assets

Apifiny’s crypto trading network adds Instant Transfers for best bid and offer

Instant transfers significantly enhance Apifiny Connect, allowing traders to more efficiently buy and sell on 25 connected markets across six continents.

Retail FX

iFOREX clients can follow two experts trading in real time

Trading Rooms’ access will be free of charge for active traders who open an account with the broker.