AMF Raises Concerns About “Regulatory Arbitrage”
The European regulation on cryptocurrencies, known as MiCA (Markets in Crypto-Assets), was intended to establish a harmonized framework across the continent. However, France appears to be deviating from this approach, threatening to block access to its market for certain crypto companies despite their authorization elsewhere in the EU.
Marie-Anne Barbat-Layani, president of the French Financial Markets Authority (AMF), the country’s financial watchdog, recently spoke on this issue. According to her, the “European passport” system provided by MiCA could encourage crypto players to gravitate toward countries with the least stringent licensing standards.
“We do not exclude refusing EU passporting. Legally, it’s very complex and not a good signal for the internal market […] But it’s a possibility that we’re keeping open,” she told Reuters.
The AMF therefore fears a form of “regulatory arbitrage”, where companies would seek to establish themselves in countries offering the most favorable framework, potentially circumventing French requirements. This position challenges one of the key principles of MiCA.
Potential Blocking of Specific Licenses
Although the AMF has not specified which licenses it might target, this blocking threat raises numerous questions. Which companies would be affected ? On what criteria would France judge their approvals insufficient ?
Beyond the legal aspects, this French stance seems primarily motivated by the desire to protect its domestic market. Barbat-Layani describes this potential “nuclear weapon” as a “pressure tactic” against what she considers “loopholes” in the MiCA licensing system.
A Negative Signal for Crypto Adoption in France ?
By questioning the European passport, France is engaging in a regulatory arm-wrestling match that could undermine the confidence of investors and companies in the French crypto ecosystem. This sends a discouraging signal for the widespread adoption of digital assets in France.
While MiCA was supposed to offer a clear and stable framework for industry development, these tensions highlight the persistent challenges in crypto regulation at the European level. Industry players will need to navigate carefully in this uncertain regulatory landscape.
