‘We don’t have much time left’ to regulate crypto, says Bank of France governor

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Bank of France Governor Francois Villeroy de Gallo said Europe must make regulation of digital currencies a priority or risk digital assets that challenge its monetary sovereignty.

At the Paris Europlace Financial Conference today, Villeroy He said He believed that the European Union had only “a year or two left” to put in place a regulatory framework for cryptocurrencies. Inaction, according to the central bank governor, would “risk eroding our monetary sovereignty” and potentially weaken the euro.

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“I must stress here the urgency: We don’t have much time left, a year or two,” Villeroy said. on both [digital] Currency and payments, we in Europe need to act as quickly as possible.”

Villeroy called on the European Union to “adopt a regulatory framework in the coming months,” given the growing role cryptocurrencies are playing in regional markets. The Refuse to use cash During the first few months of the pandemic, was the trend that Villeroy said could lead to “marginalization of the use of central bank money”.

Related: The Bank of France is closely watching stablecoin developments, says the governor

The governor of the Bank of France previously warned regulators about the potential risks of cryptocurrencies, including stablecoins, central bank digital currencies or central bank currencies. In September he said Big tech companies can build “Private financial infrastructures and monetary systems” – including the issuance of their own stablecoins – which could negatively affect fiscal sovereignty in the European Union for decades.

In January, the bank Complete a trial program For its central bank cryptocurrency, it later reported that investors bought and sold €2 million — roughly $2.4 million at the time — of simulated stock. The Bank of France said it will conduct other tests of the digital currency this year.