Regulation
Circle, Ripple and other crypto giants came to Paris for “regulatory clarity” and returned with a reality check – DL News
Summary of blockchain week in Paris
- The mood in Paris last week was a mix of relief and uncertainty as the crypto regime takes shape.
- The EU may not be as crypto-friendly as Americans think.
- The SEC’s decision regarding Uniswap was the talk of the conference last week.
Last Wednesday morning, Verena Ross, executive director of the European Securities and Markets Authority, gave hundreds of crypto industry supporters attending Paris Blockchain Week a reality check.
They wanted to know more about the European Union’s famous “regulatory clarity” regarding cryptography. This was a very positive contrast to the crackdown by US regulators.
Still, Ross said MiCA – or regulation of crypto asset markets – was not a panacea for crypto businesses and she disputed the idea that the EU was crypto-friendly.
“I’m not sure I necessarily use the word friendly,” she told the nearly 200 attendees.
“What we’ve done in Europe is lawmakers have created a real regulatory framework specifically for crypto. This replaces what was somewhat of a patchwork of different national approaches.
For many American cryptocurrencies angered by regulatory crackdowns at home, this sounded great.
An intoxicating market
For four days last week, around 10,000 developers, investors, media types and various C-level bosses gathered in the French capital to gather information and network.
In the Louvre’s underground conference center, attendees heard from Binance CEO Richard Teng, Ripple CEO Brad Garlinghouse, and Circle CEO Jeremy Allaire.
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If Bitcoin ETFs and a heady market were a priority, so were the realities of doing business in an increasingly regulated world.
France, of all nations, has done everything possible to present itself as an antidote to such concerns. With tax breaks and investment incentives, French authorities have welcomed crypto projects.
“We had no other choice to make in Europe than France,” Dante Disparte, Circle’s director of global strategy and head of policy, said during a panel at the event. stablecoin issuer.
“Of course, it’s not just about the opportunities the country offers, the depth of the capital markets, the wealth of talent, the technological base and, frankly, the clarity of regulation.”
But ESMA’s Ross took a sober attitude. “The key, clearly, and this is a call to everyone here, is to be prepared,” she said.
“Don’t underestimate that there will be a new regime and therefore you will need to be able to comply with it.”
Bet big on France
Despite this, Allaire and Circle, the issuer of the $32 billion project USDC stablecoinare betting big on France.
In 2023, Circle got conditional registration as a provider of digital virtual assets in France and has established its European base in Paris.
He also hired Coralie Billmannone-time payment manager at the PayPal office in Luxembourg and at JPMorgan Chase in Paris, to lead the operation.
In May, French President Emmanuel Macron guest 200 business leaders, including Disparte, in Versailles.
With MiCA coming into force by the end of the year, national regulators across the 27 EU member countries are busy formulating regulations to complement this landmark regime.
The pillar of the regime is to ensure that all crypto businesses are registered and licensed so that investors are protected from predatory practices that are rampant in other markets like Asia.
Passport
For crypto companies such as Circle, the practice of “passporting” will be crucial as it will allow them to offer their services to clients across the block from a single location.
“We have set up an office and an infrastructure to be able to issue our coins outside of France,” Billman said last Monday. “We want Europe and France to be a privileged market for our company. »
In a former vault formerly used by the Banque de France, Allaire took the stage at Pavillon Vendôme last week to promote Circle’s euro-backed stablecoin, EURC, and outline its strategic plan.
“Today, blockchain technologies, web three, digital assets, are becoming major national priorities all over the world,” Allaire said.
“It is a priority for the French government. This is a priority for the Japanese government. This is a priority for the Hong Kong government.”
To make his point, he presented one of his favorite cryptographic diagrams: a smaller circle inside a larger circle.
The smaller circle represents the current value of stablecoins – around $142 billion – and the larger circle represents the non-crypto version of electronic money worldwide, which is over $21 trillion.
Allaire’s point: Stablecoins are capable of growing more than 850 times.
And Circle, which is I’m thinking about an IPO this yearis going to be invaluable to customers and investors.
For what? Because Circle respects the rules, says Allaire. And in France, that means MiCA.
“USDC and we anticipate that, as part of MiCA, EURC will play a really critical role in how digital money moves in and out of all of these different capital market structures,” he said. declared.
“That’s where the growth will come from.”
At Paris Blockchain Week, some US crypto executives reiterated the oft-stated idea that the EU would pull crypto activity out of the US.
“We see the United States almost ceding its leadership in what is a transformational technology,” said Eric van Miltenburg, Ripple’s senior vice president of strategy. DL News.
On Wednesday, news broke that the SEC had informed Uniswap, a decentralized exchange, that it was likely to be sued for violating U.S. securities laws.
Back in Paris, there were other worries, notably that of being on the guest list for the best side events.
Red carpet
That evening, conference attendees invaded Faust, a chic cocktail bar on the banks of the Seine. The Solana Foundation, a data provider called Pyth, and the bustling memecoin Bonk were hosting a reception.
Alice in Wonderland card guards lined the red carpet leading to the bar. Inside, a white rabbit statue watched over the partygoers. In the back, a jester led the others to a hidden speakeasy.
Behind the room’s long bar was a huge red and white house of cards sculpture. Next to it, bright orange, red and white lights shined the Bonk logo.
Almost no one seemed discouraged by the SEC’s decision on DeFi’s $7 billion trading platform. Uniswap Labs is, after all, based some 6,000 kilometers from Paris. Far from repressive measures and downward coercive measures.
Instead, the mood is much more optimistic. Regarding Circle’s potential IPO this year, one Circle employee has only one regret.
“I wish I had more equity,” they said DL News.
Liam Kelly is DL News’ Berlin correspondent. Contact him at liam@dlnews.com.