Business

Cecille de Jesus

French central bank wants Europe to work on fiat-crypto exchanges

Governor de Galhau makes a U-turn on his stance on cryptocurrencies and wants platforms to easily switch between crypto-assets and the real economy.

Government and central bank intervention isn’t usually a happy thing for the crypto community, with the past year being riddled with crackdowns and regulations dragging trade values down. A recent statement by the Bank of France’s governor Francois Villeroy de Galhau, however, may put a smile on any crypto enthusiast’s face.

Last year, he issued a warning to the public about the volatility of cryptocurrencies, saying they are speculative assets that have “no economic basis” and are “nobody’s responsibility.” But in a statement at the City Week 2018 in London, de Galhau made a U-turn on his stance, saying focus should be shifted towards cryptocurrencies, and that bridges must be built to make it easy to switch between real world assets and crypto-assets.

“In particular, we should work on exchanges and platforms which provide services at the interface between crypto-assets and the real economy,” de Galhau said.

This contradicts the European Central Bank (ECB) chief supervisor Daniele Nouy’s previous statement saying cryptocurrency development is “not exactly very high on our to-do list.” Based on Nouy’s statements, they prefer a more passive stance in dealing with cryptocurrencies. “We scrutinize the issue in a regulatory perspective, we are ready to do something if it was needed,” she said.

While blockchain technology has been making strides and gaining applause from regulators themselves, so far, countries the world over are still divided when it comes to cryptocurrencies. Recent calls for unity have been made.

In March, the issue of cryptocurrency regulation has been a subject at the meeting of the G20 (Group of Twenty). Dutch Finance Minister Wopke Hoekstra wrote an open letter calling on European countries to immediately take a stand and come together on structuring regulatory framework to cover cryptocurrencies. He says that regulation must be created with an international approach, otherwise enforcement is impossible. After all, one of the main value proposals of cryptocurrency is its ability for frictionless cross-border transactions.

This stand was later echoed by International Monetary Fund (IMF) chief Christine Lagarde, saying “we can fight fire with fire” by turning blockchain technology against the criminals that use them for their illicit activities.

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