In the latest development, the French government seems to have shown its interest in Bitcoin as the French Prudential Supervisory Authority (ACPR), which regulates the nation’s banks, has issued a statement clarifying the status of Bitcoin and Bitcoin exchanges. Last year in December, the Bank of France warned about risks related to the digital currency Bitcoin.
Then the Bank of France had said that the price of Bitcoin in legal currencies was inherently volatile and users may find it difficult to convert to real money. It had also said that even if Bitcoin is not currently a credible investment vehicle and therefore do not pose a significant risk to financial stability, they represent a financial risk for those who hold them.
Now, the latest argument on the part of the French Prudential Supervisory Authority is that in addition to the standard list of concerns and warnings, anyone operating a Bitcoin exchange in France must have a license to operate. Nevertheless, this stand from the earlier stand by the Bank of France is far better and inclusive.
The Government Agency Worried about Consumer Protection from Fraud
As according to the ACPR now intermediation in the sale or purchase of Bitcoins, or receiving funds to transfer Bitcoins, requires the seller to be treated like any other payment service, it looks; it will be under some sort of regulation. Also, as now it looks ACPR wants to keep an eye on the Bitcoin exchanges for any wrong doings.
However, the latest decision on the part of ACPR is not any kind of authoritative declaration that Bitcoin is a legal tender as the authority also reminded the public that the European Banking Authority (EBA) has already issued public warnings about digital currencies. Thus, there are already concerns about the lack of regulatory authority and protection for consumers.
The French government’s agencies including the Bank of France and now ACPR have been showing their concern for the protection of customers in case an exchange or other Bitcoin-related service defaults. According to it the risks involved with storing Bitcoins on a computer, lack of a protective legal framework, high volatility, risk of abuse by criminals, and possible tax implications, etc.
In its statement ACPR says that exchange platforms that acquire or sell Bitcoins for legal tender must make transactions through a registered provider that may include inter alia credit institution, payment institution or an electronic money institution.
To contact the reporter of this story: Deepak Tiwari at firstname.lastname@example.org