French lawmakers have voted in favor of new legislation that establishes a more stringent regulatory framework for digital assets. VASPs (Virtual Asset Service Providers) now need to implement robust security, counter-money laundering, and asset segregation protocols. Having said that, these regulations are on a lighter side compared to the earlier proposals.
✅ Projet de loi DDADUE dans les domaines de l’économie, de la santé, du travail, des transports et de l’agriculture | Adoption par l’Assemblée nationale, compte tenu du texte de la commission mixte paritaire.
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— Assemblée nationale (@AssembleeNat) February 28, 2023
National Assembly in Favour of MiCA
Reports of the proposed laws emerged two weeks ago, and on February 16, the Senate voted in favor of the draft bill. On February 28, the National Assembly subsequently passed the bill, with 109 votes in favor and 71 against, thus officially introducing the new regime.
President Emmanuel Macron now holds the bill, as he has two weeks to either sign it into law or veto it and return it to Parliament. Macron has previously expressed his favor of stringent regulations, such as the Markets in Crypto Assets (MiCA) framework, which makes it likely he will sign the bill.
VASPs in France can operate upon registration with the Autorité des Marchés Financiers (AMF). To date, sixty VASPs have successfully completed the registration process, which is relatively simple. Whereas, acquiring a license is more complex and requires the AMF to perform the same checks as in the case of traditional financial institutions.
Better Regulatory Rules for VASPs
VASPs will be held accountable to moderate standards, including the establishment of robust anti-money laundering and cybersecurity programs, the segregation of user funds, and increased disclosures related to risks and operations.
Once President Macron signs the bill, it will become law by the middle of this year. This draft bill is set to be a considerable advancement for the French digital asset sector, but the imminent MiCA system is expected to be an even more substantial shake-up.
In April, the EU(European Union) will vote on the MiCA, which is predicted to have a significant effect on stablecoins, NFTs, digital asset exchanges, and other VASPs. It will necessitate increased transparency, asset segregation, enhanced custody solutions, and a unified licensing regime for all EU nations.