French Lawmakers Vote in Favor of Softer Crypto Licensing Regulations

Fortune has smiled on crypto firms in France as the National Assembly has now voted in favor of rules that will ease out the requirements and regulations for licensing.

According to the proposal voted by lawmakers, crypto companies in France will be required to follow additional conflict of interest and consumer protection rules this year.

Initially, Lawmakers were debating whether to enforce a mandatory licensing regime for crypto exchanges. The first proposal came with a lot of requirements mandating digital assets companies to hold a license before October.

This high-tier proposal was precisely suggested by social-liberal Senator Hervé Maurey. This suggestion by Senator Maurey hit a brick wall in the crypto industry as no firm showed up to receive the accreditation. 

Instead, French senator Daniel Labaronne requested that the high-tier mandatory licensing be ditched and suggested a rule that allows digital asset service providers to register with the region’s financial watchdog as part of the requirement covered by the European Union’s more robust crypto regulations. In the end, the French National Assembly voted in favor of an amendment to the proposal.

The proposal received 61 votes in favor and another 33 against its implementation. This marks a softening of the initial stance of the Finance Committee of the Assembly on crypto company licensing. Senator Labaronne’s amendment proposal covers requirements on governance, reporting to regulators, and segregation of funds.

Would MiCA Crypto Regulations Have Mitigated FTX Collapse?

Therefore, crypto firms in the region that are already registered with the existing anti-money laundering scheme can continue to operate until when the Markets in Crypto Assets regulation (MiCA) is launched.

More so, the implosion of FTX has awoken the sense of urgency in regulations amongst regulators across the world. As is the case with other European Union countries, France is also awaiting the launch of the MiCA. 

Several EU lawmakers believe that robust crypto regulations like MiCA would have mitigated the effect of the implosion of FTX.

On one hand, a handful of lawmakers said that MiCA would have protected EU citizens from the liquidity crunch. While another group did not agree with this argument. MEP Ondrej Kovarik said MiCA wouldn’t have fully stopped or prevented the fallout even though it would improve transparency and protection levels for investors.