France’s New KYC Mandate Set to End Crypto Anonymity in The Country
- France has unveiled new regulatory framework set to prevent crypto anonymity.
- The new framework aims to prevent money laundering and the financing of terrorism through the use of digital assets.
Bruno Le Maire, finance minister of France, speaking at a meeting, announcing his candidacy for president in Aubervillier, France on 5 March 2016. Shutterstock
The French Ministry of Finance introduced an order that aims to prevent the use of digital assets in money laundering and financing of terrorism. According to the ordinance — published on 9 December — all digital asset service providers in the country are now included among entities that are banned from keeping anonymous accounts.
“This demand, which comes from companies operating in the crypto ecosystem, will help combat the anonymity of digital asset transactions while facilitating the identifications of users,” the ministry said.
The new know-your-customer (KYC) requirements will require cryptocurrency companies to check their customers’ identities, verify “beneficial owners,” and prohibit all anonymous accounts on their platforms.
Signed by finance minister Bruno Le Maire, overseas minister Sébastien Lecornu, and junior economy minister Olivier Dussopt, the order is a direct answer to the growing use of cryptocurrencies in terrorist financing networks.
Le Maire said that the measures are a necessary step in the country’s fight against terrorism; the dismantling of a large terrorist cell last September unveiled that it was mostly financed through cryptocurrencies.
“We must drain every single euro from all channels of terrorist financing,” he wrote in a 9 December tweet.
The Finance Ministry noted that it was preparing new regulatory provisions that would speed up the development of “digital identification solutions” for cryptocurrency transactions; the goal is to create a secure and attractive environment that will promote the development of crypto assets.
- Crypto exchange Bitget will make it mandatory for new users to undergo its level-1 KYC process starting 1 September, old users will have until 1 October to do the same.
- The level-1 KYC process requires users to submit a government identification and undergo facial authentication, and is in line with global regulatory guidelines.
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- The updated KYC checks will be introduced on 15 July, after which new users will be required to complete the process in order to gain full access to the exchange’s services.
- Existing users who fail to complete the KYC checks will face limitations on the platform, such as being unable to deposit new funds and only having access to certain services.
- The 1,400-page document lists the names of all users eligible for withdrawals, as well as the conditions that they need to meet in order to withdraw their assets.
- The bankruptcy court has permitted Celsius to return 94% of each eligible user’s assets, but only after their account has been updated with AML and KYC data.