France is currently determining a legal framework for initial coin offerings (ICOs), according to its financial market regulator.
Robert Ophele, president of the Autorite des marches financiers (AMF), said that they are developing regulations for the market, reports business magazine Challenges.
“We want to get a quick position on the issue,” Ophele said.
At present, it’s not known when the rules will be released. However, France becomes the latest country to announce that it plans to regulate ICOs.
In a Q&A interview, Ophele said that the use of digital currencies enables cash transfers to be conducted in a ‘fast and cost-free way’ around the world. However, he balanced his views by adding:
“[Cryptocurrencies] can very easily be the receptacle of all that one wants to avoid: tax evasion, money laundering or the financing of terrorism.”
These remarks come at a time when regulators around the world are considering their own positions regarding fundraising through ICOs and the regulation of digital currencies.
In July, the U.S. Securities and Exchange Commission (SEC) released an investigative report that found DAO tokens were securities and subjected to securities laws.
At the time, Jay Clayton, SEC chairman, said:
“The SEC is studying the effects of distributed ledger and other innovative technologies and encourages market participants to engage with us. We seek to foster innovative and beneficial ways to raise capital, while ensuring – first and foremost – that investors and our markets are protected.”
Last month, the SEC reported that it was in support of ICOs that do not fall under the definition of securities. According to a report, tokens such as Filecoin, Civic and Gnosis are tokens that grant investors credit for future use. As such, they act like a type of pre-paid gift card and don’t guarantee an ownership stake in the companies or blockchain networks. As a result, they don’t fall under the SEC’s jurisdiction.
On the other hand while countries such as Canada are taking a neutral approach, the same can’t be said for China and South Korea.
In September, both countries banned the use of digital currency tokens through ICOs. Chinese authorities have also halted domestic digital currency exchanges from trading. South Korea’s financial regulator, the Financial Services Commission (FSC), also stated that margin trading of digital currencies would be illegal following its ICO ban.
What France’s position will be regarding projects and startups raising funds through ICOs remains to be seen. However, it’s clear that authorities are taking a more proactive approach to the industry.
Just recently, Russia’s president, Vladimir Putin, voiced his support of the regulation of digital currencies as they ‘bear significant risks.’ Yet, while he’s aware of the Bank of Russia’s opinion on cryptocurrencies, he’s keen ‘not to put up too many barriers.’ According to Anton Siluanov, Russia’s finance minister, digital currencies are expected to be legalised and regulated in 2018 to crack down on money laundering.