Crypto Adverts and Announcements Fall in France As A Result of Regulatory Restrictions

The ruling that the AMF (Autorité des Marches Financiers) of France had passed, substantially limiting the advertisements or distribution of cryptocurrency derivatives on French soil, has begun to show results as the number of both adverts and announcements of such offerings have come down drastically. The ruling had stipulated that brokers who were working with crypto CFDs (contracts for difference), which allows users to predict changes in value of an underlying asset and make profits out of it; would have to work within a given regulatory framework. The ruling did not place a blanket ban on such adverts but noted that there would be no toleration for breaking of rules. All firms working offering coins or tokens were directed to focus on getting regulatory approval and sticking to the rules.

This Friday, AMF reported that at present, the numbers of advertisements right now are just 25% of what they had been during the period between January’18 and September’18. During this period, the AMF noted, the market shares for crypto, initial coin offerings (ICOs) and allied blockchain tech-based products, also plummeted from 23% to 12%.

The AMF had been one of th first regulatory authority within the EU, to have issued such a directive. They had laid down that all financial products related to digital currencies were to be termed as derivatives and these would fall within the ambit of its directive. These assets would therefore need to be regulated in such a way that only authorized trading platforms would be able to promote them. France had passed another directive recently which complicated the GDPR-Blockchain contradiction.Although the legality of these has not been completely clarified completely by the regulatory authorities yet, most regulators deny the crypto derivatives the status of being actual assets. Europe, at large, has not seen concrete crypto legislations yet and some regulators have made only sketchy attempts to address the issue. One such effort was by the ESMA, that recommended imposing restrictions on the retail investors using crypto CFDs.

Earlier this year, in April, the government of France came up with a plan for tax reform, which culminated in crypto investors paying lower taxes: 19% instead of the earlier rate of 45%. Yet, at the same time, the government so chose to classify assets such as Bitcoin as “moveable property”. Earlier these profits were categorised as “industrial and commercial profits” for regular investors.