France updates its crypto regulation in line with the MiCA

France is updating its crypto regulations to harmonize with the European Union’s MiCA regulation. The changes will take effect on 1 January 2024. 

Regulation: France and new crypto rules aligned with MiCA

The Autorité des marchés financiers (AMF) has announced that it is in the process of updating its crypto regulations to be in line with the European Union’s MiCA Regulation. 

Specifically, the French AMF is considering the “enhanced” registration of digital asset service providers, also called DASPs, introduced by the DDADUE law. 

These changes will come into effect on 1 January 2024 and anticipate, to some extent, the work being done by the EU’s Crypto-Asset Markets Regulation (MiCA). 

In practice, a new Article 721-1-2 of the MiCA General Regulation has been created that will come into effect on 1 January 2024, and which stipulates that all crypto service providers will be required to be registered. 

However, DASPs that have obtained a simple registration before 1 January 2024 benefit from a “grandfather” clause and continue to be subject to the regulatory framework applicable before this date.

In addition, the new French regulations, want to align the licensing requirements for DASPs with those for the European authorization of crypto-asset service providers (CASPs) under the MiCA Regulation.

The procedure will enable the implementation of an accelerated procedure for the authorization of CASPs. 

Crypto regulation in France and MiCA: the case of Societe General

In late July, Societe General, or SocGen, became the first company to obtain a crypto license in France. 

And indeed, the company’s crypto division, SG Forge, received the green light to offer a diverse range of services. 

Specifically, the French AMF has reportedly formalized authorization for SG Forge to provide custody services for digital assets. In addition, the first crypto-licensed firm in France is also authorized to offer cryptocurrency trading and “receive and transmit” third-party crypto orders. 

According to the current AMF update, SG Forge will be one of those DASPs that may be subject to the current regulatory framework even after 1 January 2024. 

The MiCA 2.0 proposed by the governor of the Bank of France

At the end of June, some policy experts had spoken on calls for a new version of the MiCA. 

Basically, just a step away from the entry into force of the first revolutionary MiCA regulations on 29 June, there were financial policymakers already talking about and urging the second version of this law. 

Among many, there is François Villeroy de Galhau, the governor of the Bank of France, who reportedly said that lawmakers should immediately develop “MiCA 2.0,” for better crypto regulation. 

Even the President of the ECB, or European Central Bank, Christine Lagarde, herself reportedly supported the idea of MiCA 2.0, also to incorporate some loopholes on DeFi, crypto lending and staking into the legislature. 

Despite this “pressure” on crypto regulations in the EU, at the moment there is still no project related to MiCA 2.0.