France has warned it may challenge the right of some crypto companies licensed elsewhere in the European Union to operate domestically, stepping up pressure for stricter oversight of the industry, Reuters reports.
Marie-Anne Barbat-Layani, president of France’s financial markets authority (AMF), told Reuters that under the EU’s new Markets in Crypto-Assets (MiCA) regime, crypto firms are seeking out jurisdictions with looser standards. She said France could resort to blocking so-called passporting rights that allow firms authorized in one member state to operate across the bloc, describing such a move as the “atomic weapon” of regulatory enforcement.
While legally complex and a poor signal for the single market, Barbat-Layani said it remains “a possibility we hold in reserve.”
MiCA, which came into force this year, lets crypto firms apply for a license in one EU country and use it throughout the 27-nation bloc. But regulators have already flagged inconsistencies in how the rules are applied, raising concerns that licenses may be granted too quickly or without proper scrutiny, the news outlet said.
On Monday, France, Italy and Austria released a joint paper calling for supervisory powers over major crypto firms to be shifted to the European Securities and Markets Authority (ESMA), based in Paris. They argued that pan-European oversight would better protect investors and ensure consistent enforcement.
France has long advocated for ESMA to take a stronger role in supervising financial markets. ESMA head Verena Rosshas said she supports the idea, but it faces resistance from some EU member states, according to Reuters.
Read more at Reuters