France is adopting a softened approach to digital asset regulations that will give virtual asset service providers (VASPs) more time to comply with European regulations.
The French National Assembly voted for an amendment allowing VASPs to continue operating without obtaining full licensing. The amendment, proposed by centrist lawmaker Daniel Labaronne, will give VASPs 18 more months to operate as they apply for full licenses.
In France, regulators have two tiers of licensing for VASPs. The first requires the companies to register with the industry regulator, the Autorité des Marchés Financiers (AMF). Over 50 firms have registered with the AMF already.
The second is more aggressive and requires the VASPs to obtain an operating license. No VASP has gained this license yet.
Last December, Hervé Maurey proposed an amendment that would have voided the grace period French regulators have given VASPs to operate before being required to obtain the full license.
However, the amendment passed this week rejects Maurey’s proposal.
VASPs in France will now only adhere to Europe-wide standards, with the EU’s Markets in Crypto Assets (MiCA) set to be voted on later this year. MiCA is expected to sail through the European Parliament, but with this week’s amendment, VASPs will have another 18 months before having to abide by the tougher standards.
In recent years, France has been striving to market itself as the European Crypto hub. Its efforts have been rewarded, with several major players setting up shop in Paris. Reports reveal that the French government opposed Maurey’s proposal to adopt a toughened regulatory approach, afraid it could scare VASPs away.
The new amendment has been well received by the digital asset industry. Speaking to one outlet, Faustine Fleuret, the CEO of French Bitcoin industry association Adan, described the move as a “pragmatic decision aimed at striking the right balance between the flourishing of innovation in France and the safe environment for users.”
“It is also a message to the sector about the exemplary nature and professionalism expected of the players on this path towards harmonization of European regulations,” Fleuret stated.
Watch: Law & Order: Regulatory Compliance for Blockchain & Digital Assets
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