The European Union, through the European Securities and Markets Authority (ESMA), wishes to strengthen the supervision of digital assets through greater centralisation. However, France firmly opposes this project, raising questions of sovereignty, regulatory coherence, and fairness between Member States.
What does ESMA plan to do?
ESMA proposes that the supervision of crypto players should no longer be ensured solely by national authorities, but that it should be centralised at the European level. This reform would aim to harmonise the regulation of digital assets, avoid divergences between countries, and simplify authorisation procedures for companies operating in several EU states.
Currently, each European country issues its own crypto licenses, leading to a proliferation of procedures and sometimes very different standards. This system creates a form of regulatory competition that undermines market stability. By centralising regulation, Brussels hopes to strengthen transparency, investor security, and the credibility of the European ecosystem.
Why France is resisting
France fears several negative effects of such centralisation. First, it sees it as an attack on its regulatory sovereignty, believing that its authorities, such as the Autorité des Marchés Financiers (AMF), must retain a central role in overseeing players operating on its territory.
Second, Paris fears a loss of control over the licensing and supervision process, to the benefit of a European institution potentially removed from local market realities.
Finally, the issue of passporting – which allows a company licensed in one EU country to operate in all others without further authorisation – remains sensitive. France wishes to prevent a company from obtaining a license in a state with more flexible regulations and then freely offering its services in France, without direct oversight.
Stakes for MiCA and the European Single Market
The MiCA (Markets in Crypto-Assets) Regulation, currently being implemented, aims to establish a harmonised framework for cryptocurrencies throughout the Union. However, its implementation varies from country to country, particularly in terms of oversight and the requirements imposed on platforms. Some states apply stricter standards, while others favour a more flexible approach, creating imbalances and risks of regulatory arbitrage.
Centralising supervision under the authority of ESMA could correct these disparities and establish a common level of oversight, strengthening investor confidence and market stability. Conversely, if state resistance persists, MiCA could turn into a two-tier framework, limiting the effectiveness of European financial integration.
Possible consequences
If ESMA were granted the power to centralise regulation, this could lead to more uniform supervision, reduce market fragmentation, and strengthen the European Union’s credibility in the cryptocurrency sector. Investors would benefit from better protection and companies from greater legal clarity. However, excessive centralisation could weaken national authorities, reduce their ability to act quickly, and increase European bureaucracy.
Conversely, if France and other Member States manage to obtain national supervision, regulatory differences could persist. This would foster competition between jurisdictions, sometimes to the detriment of user security and market stability. In both cases, finding a balance between European harmonisation and local sovereignty will be crucial for the future of the crypto framework in Europe.
Conclusion
The debate between France and the European Union illustrates the growing tensions between regulatory integration and national autonomy. Brussels’ ambition to centralise supervision aims for greater consistency, but clashes with states’ desire to preserve their authority.
The compromise that emerges in the coming months will define not only the future of the MiCA regulation but also Europe’s place in the global regulation of digital assets.
