10 Dec 2020 · 2 min read

Clampdown on Crypto To Keep France In The Paleolithic Era Of Banking - MP

In what he called an attempt to dry the financing of terrorism, French Finance Minister Bruno Le Maire has unveiled a regulation that is to enable the state to combat the anonymity of crypto transactions. Meanwhile, local crypto industry players and at least one politician accuse the ministry of potentially hampering the sector's development.

Source: Pascal Boyart

“It is regrettable that France is still distinguished within the EU by additional constraints. Why not instead put forward efforts made to simplify KYC whose bureaucratic rules date back to the Paleolithic and are benefiting the existing banking [institutions],” Pierre Person, an MP from the ruling La République En Marche! (LREM) party, said.

In a more tongue-to-cheek fashion, Simon Polrot, President of France’s crypto asset industry association ADAN, tweeted that “France is making big waves in the international crypto press! Finally, we are promoting our superb national cryptocu… oh, no, we’re talking about the counterproductive KYC-AML measure of the day. Good job”.

Meanwhile, one Twitter user hailing from the French cryptosphere described the proposal as yet “another fight against the wrong opponent,” advising the Finance Ministry to instead focus its efforts on the country’s banks.

“Because of your 'repressive' measures against crypto companies, France will again miss a major technological shift, just like it missed the Internet shift in the early 2000s,” the user, who goes by the name of Yggdrasil, tweeted.

In a statement, the Ministry of the Economy, Finance and the Recovery said that “digital assets (cryptoassets) present important opportunities for the economy” but “last September’s dismantling in France of a terrorist financing network using digital asset transactions is a reminder of the existence of criminal undertakings against which it is necessary to fight.”

“This is why the government wishes to promote the development of cryptoassets under the best conditions of security and attractiveness,” the ministry claims. “New regulatory provisions will be presented with the aim to accelerate the launch of digital identification solutions for digital asset transactions.”

Among others, the ministry is to enforce new obligations on crypto exchanges and custody services. These will be related to the assessment of money laundering and terrorism financing risks related to crypto transactions, know your customer (KYC) measures, seizing assets suspected of serving criminal ends, but also increased cooperation with the French intelligence services.
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