France Explores Challenging Crypto Firms Licensed in Other EU Countries
France has indicated that it may challenge the right of certain cryptocurrency firms licensed in other European Union countries to operate within its borders. This move is part of a larger effort to push for centralized oversight of the bloc’s digital asset industry, as reported by Reuters on September 15.
Marie-Anne Barbat-Layani, the president of France’s financial regulator AMF, expressed growing concerns over the EU’s new Markets in Crypto-Assets (MiCA) framework. Under this framework, companies can obtain a license in one EU state and use it as a “passport” to conduct business across the entire bloc. However, this has led to discrepancies in how national regulators interpret and enforce the rules.
In a joint position paper with Italy and Austria, France has called for the European Securities and Markets Authority (ESMA) to directly supervise major crypto firms. The regulators argue that inconsistent national practices could jeopardize investor protection and market stability. Barbat-Layani even mentioned the possibility of France refusing to recognize licenses granted by other EU countries, dubbing it as an “atomic weapon” in their arsenal.
While specific firms were not named, it is known that Coinbase and Gemini have obtained MiCA licenses in Luxembourg and Malta, respectively. ESMA has been advocating for pan-EU supervision to ensure uniform authorizations across member states.
Malta, a pioneer in digital asset regulation, faced criticism from ESMA earlier this year for deficiencies in its licensing process. France, Italy, and Austria have also called for stricter MiCA rules, such as enhanced cybersecurity standards, clearer guidelines for token offerings, and increased oversight of firms’ activities outside the EU.
Despite resistance from some EU members who prefer national control, ESMA Chair Verena Ross has expressed openness to broader authority. The goal is to regulate a rapidly expanding multi-trillion-dollar industry that could potentially pose a risk to financial markets if not effectively supervised.
The debate over centralized supervision of the EU’s digital asset industry underscores the importance of harmonizing regulations to ensure a level playing field for all market participants. France’s stance signals a push towards greater oversight and accountability in the rapidly evolving world of cryptocurrencies.