American Crypto Business? Welcome to France!
In late April, the European Parliament gave the green light to the Markets in Crypto Assets (MiCA) legislation. MiCA has emerged as the first-ever and most comprehensive package of standards and rules governing the crypto industry across EU nations. This development prompts us to ponder how the ripple effects of MiCA will be felt outside Europe.
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A Mass Exodus
The French Financial Markets Authority (L'Autorité des Marchés financiers, AMF) anticipates that over 100 crypto businesses may migrate from the US to France. Nestled on the banks of the Seine, they could potentially escape the ambiguities and pressurized policies of US regulators. French lawmakers are ready with open arms, reassuring all newcomers of assistance in transitioning jurisdictions and setting up their businesses under European norms.
The Scope of Hospitality
As per current data, France is home to 75 registered crypto firms, with another 25 waiting in the wings for registration. Some of these entities hold US jurisdiction. The lineup is spurred on by the new MiCA regulatory groundwork, which opens up broad prospects for the crypto sphere. European crypto regulations will not fully take effect until 2025, meaning there's still ample time for decision-making, and no immediate rush to shift business operations to France. However, it's noteworthy that France has already gathered a troop of a hundred crypto firms.
The Permit System
Moreover, the AMF explains that Paris is considering an expedited registration process for incoming crypto firms. Even before the enactment of MiCA, France already had a national crypto regulation framework in place. All firms were required to undergo a simplified registration process, with an optional choice for a higher level of authorization, which requires more detailed disclosure. These obligations are similar to what firms will face within two years under MiCA. As of now, the French regulator is gearing up to ensure a seamless transition from national rules, easing crypto companies' adoption of MiCA.
A Lion's Patience
Simultaneously, the United Kingdom is adopting a cautious and somewhat stringent stance on cryptocurrency regulation. As it no longer belongs to the European Union, the UK can disregard the broader European legislation. Specifically, some UK regulators suggest treating cryptocurrencies like gambling activities.
However, this view is rather extremist among lawmakers. Andrew Griffith, Economic Secretary to the UK's Treasury, recently promised that the UK would have its own crypto legislation by the following spring. The official also noted that the British have finally regained legislative control after decades, hinting at the effects of Brexit. In other words, there is no anticipation of MiCA's implementation in England. Generally, the British lion's behavior appears rather relaxed. While France is actively attracting crypto companies to its jurisdiction, discussions on the British Isles are more focused on the future of the market.
The Global Regulatory Landscape
The regulation of cryptocurrency varies depending on the country; some are more welcoming, while others are cautious or even hostile towards crypto. National regulators see differing opportunities and risks associated with cryptocurrencies.
In this respect, MiCA stands out for its predictability for companies in the crypto sector. Venture capital investment in European crypto projects is on the rise, indicating that investment follows regulation.
Currently, France is regarded as the most crypto-positive country in the European Union. Influential French figures and high-ranking officials actively participate in the regulatory process, and Paris hosts notable crypto events. According to analysts, France's prominence on the global crypto stage has significantly increased in recent months.
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