The Ministry of Economy and Finance, as well as the French Ministry of Foreign Trade, submitted a decree on “combating money laundering and financing of terrorism (FATF) for digital assets”, which is controversial.
Controversial crypto-industry regulation policy
Although the French government recognizes the many possibilities of cryptocurrencies and basic blockchain technology for local and global economic activity, it has also warned of many risks arising from the wrongful actions of these assets. This came after another meeting of G7 Finance.
Following the liquidation of a terrorist network using crypto assets in September 2020, the French authorities want to take measures to combat the theft of funds. That’s why the government wants to combat the anonymity of crypto-asset transactions.
In addition to crypto-fiat exchange platforms and companies offering cryptocurrency storage services, digital asset exchange operations and crypto-asset trading platforms, now have to conform to the obligations of the Monetary Code in terms of AML-CFT, or “know your customer” (KYC) process.
The announcement on Twitter about the presentation of this ruling has prompted many reactions in the crypto community. Owen Simonin (aka Hasheur), the most popular French crypto-Youtuber, immediately responded to the government on Twitter. He believes that such measures can become a serious brake on the cryptocurrency market.
“Jokes aside! Do you realize how difficult it is to implement? And the transformation losses for the French in this environment? It’s a huge drag on the crypto industry”.
The founder of French mining company Just Mining went a step further, criticising the government’s rush to “punish the nascent ecosystem”.
“It’s simple. There are terrorist attacks and people are waiting for action from the Minister of Economy. But this very severe punishment (without consultation) will affect the entire developing ecosystem, which will change the whole course of events as early as next week,” explains Owen Simonin.
G7 Finance demands crypto regulation
According to a press release from the U.S. Treasury Department, finance ministers and central bank officials of the G7 industrialized countries recalled their demand to regulate the deployment of crypto space, referring to the fact that the crypt regularly becomes an object of attention in computer virus attacks.
“We strongly recommend that cryptocurrencies are regulated,” said this press release issued after the meeting, which was held in videoconference mode. Representatives from the International Monetary Fund (IMF), the World Bank and the Financial Stability Board (SPS) also attended.
The leaders” discussed ongoing responses to the changing landscape of cryptocurrencies and other digital assets, as well as the “work of national authorities to prevent their malicious use and illegal activities”.
G7 Finance members reiterated their support for a press release issued in October, during their last virtual meeting, during which they expressed “concern” at the growing number computer virus attacks, often associated with crypt at the height of the Covid-19 pandemic, and called for caution when deploying them.