With the SEC cracking down on big brand crypto firms, many CEOs are looking toward Europe for more lenient regulations. Executives such as Coinbase CEO Brian Armstrong and Ripple CEO Brad Garlinghouse have expressed interest in considering European markets due to confusing regulations in the US. Europe, particularly France, offers a more defined regulatory environment that attracts international companies, thereby opening up the market to them.
The French Autorité des Marchés Financiers (AMF) Secretary General Benoît de Juvigny has already extended an invitation to American crypto firms to take advantage of French and future European rules. The recently adopted MiCA guidelines in Europe have prompted many to prepare for these upcoming regulations and the establishment of Crypto Asset Service Provider (CASP) status at the European level.
Currently, 72 registered crypto companies call France home, and Circle, the firm behind the second-largest stablecoin by market capitalization, is seeking dual registration in France for better localization for the European market. Other crypto giants like Binance, Crypto.com, eToro, and Digital Currency Group’s Luno also have registered with the AMF. However, challenges lie ahead as companies will need a full license by January 2024 to operate within France even before the European Union regulations take effect.
A structured framework is crucial to protecting individual savings, but there are concerns it may impede innovation. This double-edged sword concept captures both the positives and negatives of a clear and defined regulatory framework in Europe. At the same time, MiCA regulations for 2025 will allow for extended service provisions across the European market, including crypto investments, advice, and portfolio management.
Unfortunately, there are still some areas where French authorities need to provide clarification, including topics such as NFTs or DeFi. Additionally, taxation concerns within the short term loom as the PACTE law proposes taxing profits without allowing the offsetting of losses. The current regime in France doesn’t require taxes to be paid on capital gains, as long as they remain within the crypto sphere.
Despite these questions, French regulators and EU-wide rules are taking clearer action than their US counterparts, and for a market as fast-moving as crypto, that might be enough to sway businesses to Europe.
Source: Decrypt
