FIGAROVOX/TRIBUNE – The year 2022, marked in particular by the bankruptcy of FTX, has highlighted the need to change the legal framework for crypto-assets, believes the first deputy governor of the Bank of France, Denis Beau.
Denis Beau is first deputy governor of the Banque de France
Will 2022 go down in history as the year that marked it? the “beginning of the end” of crypto-assets and decentralized finance (known as DEFI)?
Indeed, their very dynamic and creative development has resulted in increased risks and losses for players and their clients, some of which have materialized dramatically, with the collapse of the third most important stablecoin system (probably misnamed), Terra-Luna. , bankruptcy of FTX, one of the world’s largest crypto-asset exchanges and disrupting other players in their ecosystem, including liquidity providers such as Genesis or BlockFi. They were accompanied by a decrease of almost 70% in the capitalization of all cryptocurrency assets, which returned to its level at the beginning of 2021.
While these violent tremors may not yet have produced all their ripple effects, they are already rich in lessons.
An important lesson is related to the general principles of organization and resources, especially in terms of governance, internal control, protection of client assets, separation of activities and prevention of conflict of interest with related entities, accountability, transparency that apply to traditional financial actors. given the risks inherent in financial activities. Until now, the scope of application of these principles has been very limited, their content unsearchable and unequal from one jurisdiction to another for the actors of the world of crypto assetson the grounds that the distribution of their innovations should not be unduly impeded.
We are convinced that the world of crypto-assets and decentralized finance will develop again, beneficially and sustainably only with an appropriate regulatory framework, a vector of trust.
The difficulties faced by some players, the effects of contagion across borders, the losses and thefts suffered by their customers, now make it necessary to review this policy and evolve rapidly at national, European and international level towards wider regulatory requirements. stronger and more harmonized, in accordance with the joint recommendations of the G20 and the FSB on consumer protection, financial stability and the fight against money laundering. to Bank of France and at ACPR, relying on our experience as a supervisor of traditional financial players and the financial system as a whole, we are convinced that the world of crypto-assets and decentralized finance will develop again, beneficially and sustainably only with an appropriate regulatory framework, a trust vector. Its objective should be to allow all competitors to be placed on an equal footing, without suffering harmful consequences of “fraudulent” actors as has happened so far. It should also aim to strike the right balance between the objectives of protecting customers and maintaining financial stability on the one hand and operational realities on the other.
Europe has been a pioneer in this way, defining a new regulatory frameworksays MICA (Markets in Crypto Assets Regulation), which should enter into force in the first quarter of 2023, and in implementation at the end of the first half of 2024. In this perspective, the implementation in France, Instead of simple registration, a mandatory authorization of PSANs (Digital Asset Service Providers) prior to entering the MICA application, currently under discussion, is desirable. It should facilitate and accelerate the adaptation of players, created or established in France, in a regulatory environment that will allow them to evolve in a framework of trust for all on the path to innovation.