September 23, 2023

French regulator defines cryptocurrencies as “digital assets”

The French Financial Markets Authority (AMF) introduced its own “definition” of cryptocurrencies, while expressing a negative attitude towards stablecoins.

AMF clarifies to the European Commission its position inregarding cryptocurrencies, defining them as "digital assets created using cryptography and operating in a distributed registry." However, the French regulator believes that it is not yet time for an accurate classification of such assets. The agency clarified that for this it is necessary to distinguish between cryptocurrencies falling into the category of financial instruments and digital assets used as electronic money.

In addition, AMF expressed concern overabout the wide distribution of stablecoins and believes that they can become a threat to the country's monetary policy. The regulator emphasized that he did not support the launch of the Libra stablecoin from Facebook, and was convinced that any stablecoins, regardless of their size, should comply with the regulatory requirements of all countries. In this case, again, it is necessary to “draw a line” between stablecoins, which must comply with all the mandatory requirements of regulators, and ordinary payment tokens, to which these requirements can only partially apply. AMF warned that, if necessary, French authorities may prohibit stable cryptocurrencies.

In addition, the department sees certainadvantages in initial public offerings (ICOs) compared with initial public offerings (IPOs), however, the regulator considers both methods risky for investors.

Recall that in December AMF first approvedAn application for an ICO filed by a cryptocurrency startup, and in March proposed to launch a regulatory sandbox for issuers of token shares for three years.