François Villeroy de Galhau, the governor of the Bank of France, has proposed the immediate formation of a crypto regulation ground structure in an attempt to avoid the possible collapse of the monetary sovereignty of Europe.
François Villeroy prioritizes the crypto regulation in Europe
In cryptocurrencies, France is considered to be among the most advanced countries. In 2019, a law had been approved by the French parliament, which granted licenses to the crypto firms through the financial watchdog of the country, named AMF.
Currently, the European Union has been asked about instant regulation of the cryptocurrency by the governor of the central bank. The regulation structure for cryptocurrencies has been demanded, by the submitted request, to be done during two years; otherwise, there is a risk of ruining the monetary sovereignty of Europe. He has expressed the vital role played by cryptocurrencies in the financial market.
France desires to taste CBDC
The governor of the Bank of France has cautioned the authorities about the potential influence of independent digital assets like stablecoins. He pointed out during his talk in September 2020 that the big techs could construct independent financial systems such as stablecoins to cast far-reaching effects on the financial sovereignty of the country in an attempt to push it decades back. In conclusion, Villeroy mentioned that delay in launching its own CBDC would leave the central bank of Europe in an unmanageable situation.
Recently this year, a pilot test of CBDC has been successfully conducted by the financial authorities of the Bank of France. The purpose of the test was to operate on the interbank settlement of an amount valuing over $2.4M through a blockchain that was provided by SETL (a blockchain firm based in the United Kingdom).
The central bank has kept on working for the development of a European CBDC since the start of this month following its successful experiment dubbed named as ‘Project Jura’ in participation with LuxCSD (Luxembourg’s central depository of securities), Banque Internationale à Luxembourg (a private bank from Luxembourg), and SEBA (a crypto bank based in Switzerland). The target of the experiment was the lending market at a large scale rather than the individual transactions. Furthermore, some additional CBDC tests are planned to be conducted by the Bank of France during the current year.