Keeping up in line with the European Union’s (EU) Markets in Crypto Assets (MiCA) bill, France is making several amendments to its existing regulatory framework. The nation wants to ensure compliance from all crypto entities to the prescribed regulatory standards.
According to a recent announcement by the Autorité des marchés financiers (AMF), which is the prime financial regulator, the provisions of its General Regulation and its policy on digital asset service providers (DASPs) to take due to the “enhanced” registration. Notably, through this France is making changes to its crypto regulatory regime before MiCA kicks the market next year.
The MiCA regulation is a major milestone for the crypto industry in the European Union, as it aims to introduce uniform regulations and create standardized rules for crypto assets across the EU.
On Thursday, the French regulator published “enhanced” registration requirements for crypto platforms. The new requirements are included by a new Article 721-1-2 of the AMF General Regulation.
Reportedly, the enhanced process is set to include systems for managing conflicts of interest, additional disclosure obligations along with segregation of client assets and platform’s assets and prohibition to use client assets without their express prior consent.
The amendments will become necessary for compliance by January 1st, 2024. Additionally, these must be taken into account in by applicants for enhanced DASP registration. However, operators that obtained a registration before January 1st, are to benefit from a “grandfather clause” and would be subject to the previous, simpler version of framework.
Notably, the recent step from the AMF towards MiCA compliance follows its reminders for crypto operators from January. At that time, agency chief Marie-Anne Barbat Layani said that the AMF is particularly advocating for mandatory and expedited registration of cryptocurrency firms that are not authorized to offer services nationwide.
The EU parliament passed the MiCA legislation with a huge margin of 517-38 and 18 abstentions, after a series of delays. MiCA also marks the first major jurisdiction in the world to introduce a comprehensive crypto law. The Transfer of Funds regulation (TFR) was also passed, mandating crypto operators to identify their customers in a bid to halt money laundering.
With MiCA being implemented, there are expectations of betterment in the competitiveness of startups in the EU, which could lead to a rise in their market share as compared to unregulated competitors. However, some have also highlighted the incompetency challenges that it might bring.
To this, Christine Lagarde, president of the European Central Bank (ECB), called for the “MiCA II” bill, which would control the activities of crypto-asset staking and lending, which are undoubtedly rising.
Nonetheless, several European nations are already amending their existing standards to accommodate the terms set by MiCA. One of the names in the list include Ukraine, signaling a major advancement for the European crypto industry.
Overall, the implementation of the MiCA regulation is expected to have a significant impact on the crypto sector, not only in the EU but also globally. Infact, in relevance to MiCA, Europe has already received significant attention and appreciation from regulators globally.