Posted by - Crypto Reporter -
on - April 1, 2023 -
crypto Cryptocurrency paris Red flag -
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Paris isn’t alone in vying to be a crypto hub, but the rhetoric of Emmanuel Macron’s administration chimes with its view that crypto is part of a bigger contest to attract business. But without security for investors and overconfidence, the risks of a backlash are also real
Since FTX’s dramatic implosion, pressure from nervous French lawmakers on the Macron administration has led to tighter oversight. (Source: Bloomberg)
Virtual-currency entrepreneurs are feeling the heat in the US after the spectacular collapse of FTX, the closure of several crypto-friendly banks and now a top regulator’s case against Binance Holdings Ltd that threatens to engulf numerous trading firms. But it’s a different vibe in Europe, especially France, where tech bros are more likely to get the red-carpet treatment.
Jeremy Allaire, co-founder of stablecoin issuer Circle, is one of them. Speaking on the sidelines of the Paris Blockchain Week junket in the luxury surroundings of the Pavillon Vendome, he described the global shifts in crypto oversight as “a regulatory Game of Thrones” — where you win or you die. His company, which played a starring role in the Silicon Valley Bank crisis when it tried to withdraw a whopping $3.3 billion, is “doubling down” on Europe with applications for multiple licenses in France — an “innovation- forward” country, Allaire says, sporting a regulator-friendly suit and tie.
Paris isn’t alone in vying to be a crypto hub — Allaire was also in London recently — but the rhetoric of Emmanuel Macron’s administration chimes with its view that crypto is part of a bigger contest to attract business. At a recent blockchain event I moderated in London, French officials touted labor-market reforms, tax cuts and a larger post-Brexit continental banking sector as incentives to set up shop in France, where around 50 digital-asset firms have registered with the regulator and domestic champions like Kering SA are still dabbling in the metaverse.
Beyond the faded hype, Paris hopes it can attract coders and tech skills relevant to all sorts of potential digital disruption. New rules have instilled confidence in the European Union’s ability to reduce the crypto risks that have been on full display. The EU’s supervisory framework for digital assets, called MiCA, comes into force in 2024 and covers multiple tokens including stablecoins; it’s why Circle is also keen to grow its new euro-backed token. French markets regulator AMF said in January that it was open to innovation but that the crypto universe now had to choose the path of regulation.