French Ministry of Finance Targets Strict KYC Rules For Crypto Transactions

France is strengthening its fight against anonymity in crypto transactions, Bruno Le Maire, French Minister of Finance and Economics.

In a full statement sent to the Council of Ministers by Bruno Le Maire, Oliver Dussopt and Sebastien Lecornu propose stringent Know-Your-Customer (KYC) laws to govern crypto transactions. The report further calls for tough measures against anonymous accounts on any virtual asset service provider (VASP).

“We presented to the Council of Ministers this morning an order making it possible to strengthen the fight against the anonymity of crypto-asset transactions,” Le Maire wrote on Twitter on the statement on strict KYC laws on crypto.

The new rules, if implemented, are set to completely change the anonymous crypto transactions in France while forcing VASPs to check their customers’ identities, verifying crypto accounts, and reporting any malicious activities on their platform.

The new KYC requirements, first reported on TheBlock this Tuesday, aimed at curbing terrorism funding through crypto, Simon Polrot, president of French crypto association ADAN confirmed. Following the recent terrorist attacks in France, the police arrested 30 people connected with sending funding to extremists in Turkey and Syria using cryptocurrency.

This led the government to call for stronger rules to regulate anonymity in the crypto space and check user profiles sending money through France. Le Maire has been vocal on the need to “strengthen the control of funding,” given the challenges that “cryptocurrency transactions cause in terrorism financing.”

This seems to be the first wave of heavy regulation set to come across France and Europe to keep crypto-to-fiat and crypto-to-crypto transactions known. The statement states the government is very aware of the “importance of the blockchain systems” in the country’s economy. Yet, a clear policy to fight terrorism must be found, starting with crypto.

Once the Council of ministers passes the decree, it becomes law in France, forcing VASPs to collect two government identification documents for any transaction conducted on their exchange. This sets harsher laws for crypto under the jurisdiction introducing KYC for crypto-to-crypto transactions too.

The deputy governor of the Bank of France, Denis Beau, recently asked for a more global approach to regulating cryptocurrencies. While he targeted Facebook’s Libra token, the main motive behind his talk was a call for banks and regulated financial institutions to start experimenting and developing their own regulated digital assets.

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Author: Lujan Odera

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