France, that recently raised concerns around the “passporting” feature of EU’s MiCA license, has backed to bring crypto monitoring under the oversight of the European Securities and Markets Authority (ESMA). François Villeroy de Galhau, the governor of the Bank of France addressed the topic at the sixth edition of the “Fintech Forum” on Thursday, October 9.
Galhau said that the supervision of all crypto asset issuers should be delegated to the ESMA. Talking especially about stablecoins, he called for stricter regulation over how a single stablecoin can be issued both inside the EU and simultaneously outside the EU by the same, or related, entities.
The aim is to “reduce the risks of arbitrage in the event of stress,” the central bank governor noted.
France is presently in the process of developing a wholesale CBDC and a retail digital euro. While the former’s use will focus around interbank transactions, the latter will be more public use-centered.
“By next year, a pilot solution will enable financial intermediaries to settle their tokenized assets in central bank money, either through TARGET services or via a Eurosystem distributed ledger, ” Galhau said at the event.
The step will be followed by a second step wherein a shared ledger will be created to bring tokenized CBDC, bank deposits, and assets for exchange on a singular platform.
To oversee uniform MiCA licesing, stablecoin issuance, as well as its CBDC efforts, the Bank of France governor has proposed ESMA to be the monitoring authority.
Earlier this month, ESMA Chair Verena Ross said that the EU is looking to give the agency more control over the crypto and stocks sector to eliminate the fragmented oversight over EU’s financial markets. Last month, France had raised red flags against the “passporting” feature of MiCA licences — that lets crypto firms licensed anywhere in the EU, operate in other regions as well.