France is the latest country to declare war on cryptocurrency after Minister Bruno Le Maire called upon a former central bank head to draft new regulations on Bitcoin and altcoins.
Le Maire requested the former head of the country’s central bank to come up with potential regulations that will warn people against the risks of financial manipulation and speculation, especially with bitcoin. However, the regulations will also other cryptocurrencies currently being traded in the market. Unfortunately, the French Minister did not go into details regarding the content of the new rules. France’s decision to crack down on cryptocurrencies comes amid skyrocketing cryptocurrency prices.
Le Maire also stated that the French government will continue pushing internet giants to stop using tax havens. The idea is to make the UK more competitive with China and the U.S. It is not clear how France plans to implement the regulations against Bitcoin and other cryptocurrencies. One of the directors at Germany’s central bank stated that it might be difficult to enforce cryptocurrency rules in one country and so the only way to successfully regulate the cryptocurrency market would be regulation on a global scale.
Authorities from various countries such as China have been trying to implement rules on cryptocurrency trading. However, those rules may fail to gain any traction since cryptocurrency is a global phenomenon according to Joachim Wuermeling, a board member at Germany’s Bundesbank.
“Effective regulation of virtual currencies would therefore only be achievable through the greatest possible international cooperation because the regulatory power of nation-states is obviously limited,” stated Wuermeling during an event held in Frankfurt.
Just a month ago, members of the European Union and legislators agreed on the implementation of stricter rules, a move aimed at preventing the funding of terrorist activities and money laundering. Regulators in China have also placed a ban on initial coin offerings (ICOs). They have also discouraged cryptocurrency mining and even shut down cryptocurrency exchanges located in the country. South Korea is also reportedly planning to ban cryptocurrency exchanges.
Cryptocurrencies are difficult to regulate since they operate over a decentralized network. The concern from governments also highlights the promising nature of blockchain technology which offers a lot of advantages over the old money system.