© Reuters.
Investing.com – Stablecoin giant Circle Internet Financial Ltd. plans to set up its European headquarters in Paris, citing the favorable climate for cryptocurrencies created by the government of President Emmanuel Macron as a key factor in the decision. The American company will use Paris as a base to expand into the European Union, Jeremy Allaire, CEO of Circle, said in an interview. It will build on Circle’s existing footprint in Dublin and London.
“For business and political reasons, we believe France is the right hub for us as we seek to grow our business in Europe,” Allaire said, adding that Paris would become a base for his digital assets and for the on-shoring of its new product EUROC, a stablecoin which aims to be redeemable in euros. “Many companies in the financial sector have made Paris their home in a post-Brexit world,” he said.
The announcement comes at a difficult time for Circle. Its flagship stablecoin USDC saw capital flight, after Circle revealed it had $3.3 billion in reserves at Silicon Valley Bank, which it has since moved to Bank of New York Mellon (NYSE:).
Circle has filed an application with the French market authority to be registered as a digital asset service provider, and with the banking authority to become a licensed electronic money institution, Allaire said.
French Digital Minister Jean-Noël Barrot said in an interview that Circle’s decision was the result of efforts to “make France a most attractive place” to develop crypto-assets and blockchain technologies. .
France established a regulatory framework for crypto in 2019, with a simple registration process for businesses. The latter had to provide proof of the “honesty and competence” of the leaders and put in place procedures to fight against money laundering. Around 65 players have registered successfully so far, but after the collapse of the FTX cryptocurrency exchange, the vetting process has been tightened.
Companies entering the market from January 2024 will be required to publicly disclose pricing policies and risks of crypto-assets to customers, as well as the need to place customer deposits in separate accounts from those of the business. Meanwhile, the EU framework on crypto-asset markets, which will allow companies to take their registrations across the Union, is expected to come into force later in 2024.
“There have been recent developments in the cryptocurrency space that validate the approach that we have, that Circle has, that you need strong regulation for this market to grow sustainably,” he said. Jean-Noel Barrot.