The French financial authorities are working to tighten the country’s cryptocurrency regulations to prevent illegal activities such as money laundering and terrorist financing.
On December 9, several ministries in France adopted an order to prevent anonymous transactions with digital assets by banning anonymous cryptocurrencies.
The new regulations were supported by French Finance Minister Bruno Le Meur, Foreign Minister Sébastien Licorno and Microeconomics Minister Olivier Dessoubet. This order is in line with Article 203 of the French PACTE Act, which is a business plan for the growth and transformation of a business.
In the document, the ministries acknowledged that digital assets or cryptocurrencies provide “important opportunities for the economy”, indicating that the French government is fully aware of their importance.
The authorities noted that despite the promising opportunities, cryptocurrency also has significant risks associated with illegal economic activities.
Ministers specifically mentioned the arrests in September 2020 linked to a terrorist financing network that uses digital assets to cover their tracks. Ministers said that authorities and major international organizations such as the Financial Action Group, G7 and G20 have called for measures to prevent illegal activities using digital currencies, noting:
“The government wants to promote the development of cryptoassets with maximum security and attractiveness.”
Thus, the French government is preparing to introduce new regulations to introduce new digital identity tools for cryptocurrency transactions and providers of virtual assets.
The document states that “this requirement from ecosystem participants will allow us to combat anonymous transactions with digital assets, making it easier to identify users.”
French authorities have expressed clear concerns about the financing of illegal activities with cryptocurrencies. In October 2020, French Finance Minister Le Maire criticized cryptocurrency for offering additional tools for illegal activities such as buying drugs and weapons, in addition to money laundering.