New report suggests France is considering bitcoin regulation

Late last month, the French Senate’s finance committee held a meeting about the future of digital currencies in the country, addressing many of the challenges presented by cryptocurrencies for both regulators and the existing finance infrastructure. This week, the French Senate released a follow-up report, outlining a regulatory framework for bitcoin and similar networks.

The report, “Regulation in the face of innovation: public authorities and the development of virtual currencies,” includes specific concerns and needed oversight proposed by France’s Treasury, Senate, customs office, central bank (Banque de France) and anti-money laundering agency TracFin.

Although there are concerns and skepticism about cryptocurrency in the report, a CoinDesk translation of the document notes that “virtual bartering tools” such as bitcoin are “raising important legal and economic matters, that can no longer be disregarded by public authorities.” In effect, the document says that digital currency is coming to France, whether regulators like it or not, and that the best option is to create regulation sooner rather than later.

The report itself proposes few specific directions for future regulation of cryptocurrencies in the country. It encourages regulators to take a common-sense approach “in order to prevent abuses while preserving the capacity of innovation,” and to use “existing legal categories” for future rules, rather than drafting new rules specifically for digital currencies. The report also recommends that a regulatory framework for cryptocurrencies should be “carried out at the European level,” as the transnational nature of these payment systems is a poor fit for national regulation.