In Brief
- •The Bank of France requests that ESMA directly supervise the main crypto actors rather than national regulators.
- •Dollar‑backed stablecoins are seen as a threat to European monetary sovereignty.
- •The MiCA ‘passport’ system reveals flaws, notably in Malta, creating risks of uneven supervision.
- •The currently allowed multiple issuance of stablecoins could enable dangerous regulatory arbitrage.
Paris wants to centralize crypto supervision at the European level
François Villeroy de Galhau made an unequivocal call during the ACPR‑AMF Fintech Forum last Thursday. The governor of the Bank of France wants to entrust direct supervision of crypto‑asset issuers to the European Securities and Markets Authority. This proposal aims to correct the weaknesses of the MiCA regulation, which currently relies on national authorities.
The problem is simple: twenty‑seven countries, twenty‑seven different approaches. Some regulators are more flexible than others, creating opportunities for regulatory arbitrage. Malta perfectly illustrates this drift.
Last July, ESMA criticized the Maltese authority for rushing the approval of a crypto company. A license granted in Valletta automatically becomes valid throughout Europe thanks to the ‘passport’ system. The result: the loosest standards contaminate the entire single market.
“I also advocate, with the president of the AMF, for European supervision of crypto‑asset issuers, led by ESMA“, Villeroy de Galhau hammered home.
His argument holds water. Centralized supervision would ensure uniform application of rules and reduce systemic risks. The AMF, the French regulator, even threatened in September to block certain passports deemed dubious.
The European Commission seems receptive. It is currently preparing a project to transfer more powers to supranational authorities. Verena Ross, chair of ESMA, confirmed Monday that this reform would create “a more integrated and competitive landscape” for the Union.
Dollar‑backed stablecoins, the new monetary Trojan horse
Beyond supervision issues, it is the rise of stablecoins backed by the dollar that alarms Paris. Villeroy de Galhau does not mince words: these tokens directly threaten European monetary sovereignty.
The governor points out a glaring flaw in MiCA. The regulation currently allows “multiple issuance”: the same company can create a stablecoin inside and outside the EU, without obligation to maintain full reserves in both jurisdictions.
Specifically, an American issuer could flood the European market with dollar tokens while keeping most of its guarantees in the United States. In case of crisis, European authorities would be unable to seize these assets to protect local holders. A situation that, according to the governor, would strengthen the Union’s dependency on foreign non‑European and lightly regulated actors.
This concern widely exceeds French borders. Chiara Scotti, vice governor of the Bank of Italy, warned in mid‑September that multiple issuance structures “compromise financial stability”.
The European Systemic Risk Board went further in early October by outright recommending banning this practice. Admittedly, the opinion is not legally binding, but it reveals a growing consensus.
For Villeroy de Galhau, the solution is “much stricter regulation” governing these setups. The issue goes beyond the technical aspect. It is about preventing the euro from being gradually supplanted by the dollar in Europeans’ everyday transactions, including digital ones.
France has a lot at stake in this regulatory battle. By pushing for centralized supervision in Paris, it seeks to impose its vision of a regulated and sovereign crypto. The coming months will tell whether Brussels will follow this offensive line against American appetites on the European market.