France toughens crypto stance, imposes stiff KYC restrictions

Following months of comments on the risk posed by digital assets, the French Ministry of Finance has finally unveiled new know-your-customer (KYC) requirements for crypto transactions. In a new document released on December 9 by Minister Bruno Le Maire, virtual asset providers in the country will now be required to prohibit anonymous crypto accounts.

One of the unique selling propositions of digital assets is its anonymous nature. Digital assets rose to prominence on the back of privacy and anonymity in late 2017. However, this is proving to be a problem for France.

In September, the French police arrested 29 people in connection to funding Islamist extremists in Syria using cryptocurrency. Few weeks after the arrest, the country recorded some terrorist attacks. It is on this note that the French government is restricting crypto transactions.

Following the new restrictions, there is the possibility that exchanges operating in the country will have to deal with high KYC standards or risk being victims of a crackdown on anonymity in the space. Furthermore, crypto-to-crypto transactions will also fall under similar KYC requirements.

According to a tweet from Minister Le Maire, the order was presented to the Council of Ministers on Wednesday. It references recommendations from the Financial Action Task Force, as well as the G7 and G29.