Step by step towards MiCA. Europe, and particularly Franceis a standard-bearer in the field of crypto regulation. Admittedly, we’re rather ahead of the game, compared with the United States. But is this a good thing or a bad thing? The future will tell. For if regulatory frameworks are a prerequisite for adoption, there still needs to be something left to adopt. Too much regulation can also stifle creativity. In any case, we now know what companies are going to eat. with enhanced PSAN registration.
Becoming a PSAN: an increasingly complex process
Remember! It was the beginning of the year. France was working on a new PSAN (Service Provider for Digital Assets). At a time when minds were still reeling from the collapse of the FTX platform, France set its regulatory machinery in motion. The aim: to prevent fraud similar to that perpetrated by Sam Bankman-Fried, FTX ex-boss now in prison awaiting trial.
Until now, in order to offer its services to French citizens, an exchange-type company needed a prerequisite : PSAN registration. This is the first level of accreditation issued by theAutorité des Marchés Financiers (AMF). A second level exists: thePSAN approvaleven stricter. Except that, in practice, no crypto company, least of all startups, can access this second level. Only a bank subsidiary, FORGE, has just achieved this..
Obtaining PSAN registration, let alone accreditation, requires (very) substantial resources. And these are often out of reach for startups just starting out. In fact, all this regulatory red tape is likely to prevent the emergence of new businesses in France. We need to find the right balance to avoid driving business abroad. tomorrow’s potential unicorns.
That said, France continues to make progress with its regulations. And, it has to be said, it is being imitated by its European neighbors. Today are unveiled the ins and outs of recording PSAN reinforced. This will replace the simple PSAN registration existing from 1ᵉʳ January 2024. These stricter regulations are intended as a transition towards MiCA regulations (Markets in Crypto-Assets) which will take effect throughout the European Union in 2025.
>> Don’t trust platforms to hold your cryptos? Ledger has the solution (commercial link) <<
Protecting investors without killing innovation: the regulatory challenge
The decree, published on August 19, is an extension of Law 2023-171. It enables increased AMF oversight on the activities of crypto service providers. Typically, the regulator may seek the opinion of theFrench National Information Systems Security Authority (ANSSI). The latter’s mission is to verify the quality of corporate information systems security.
The AMF may also take measures precautionary measuresThe AMF will then be able to temporarily suspend or limit the operations of a provider deemed to be in difficulty. The AMF will then be able to temporarily suspend or limit the operations of a service provider deemed to be in difficulty. It may even suspend the activity of its manager.
This transition is ultimately part of the natural process of transition to MiCA, which will have a similar strengthened PSAN registration. As the crypto sector grows, so do regulatory constraints. This makes sense, as more and more individuals are involved in these activities, and the sums involved can reach staggering heights.
The first-mover advantage among industry professionals has never been greater. Visit startups launched a few years ago were able to take advantage of a flexible regulations conducive to gradual growth. There’s no doubt that this new regulation will encourage the takeover of these crypto activities by traditional institutions already in place, to the detriment of of the small startups now trying to emerge.
To store your cryptos, nothing beats a Ledger wallet. The Nano S and Nano X offer security and ease of use. In fact, they are compatible with the vast majority of cryptos and networks. They are an absolutely essential alternative to all the exchanges that offer to hold your assets for you. Remember, « Not your keys, not your coins »!