The French parliament is considering a comprehensive cryptocurrency bill that would allow the purchase of up to 420,000 Bitcoins (BTC), equivalent to about 2% of the total supply.
The bill was drafted by the center-right Union Republican Party (UDR) and introduced by its leader Eric Ciotti, and is the first cryptocurrency law of this scale in French history.
The bill is shaped under three main headings.
Establishment of a National Bitcoin Reserve
The bill proposes the creation of a public institution called the “French Strategic Bitcoin Reserve”. This institution will be tasked with creating a reserve fund of 420,000 BTC over 7-8 years. The aim is to diversify the country’s foreign exchange reserves and strengthen its financial sovereignty.
This reserve will be funded through:
- Special tax regulations for public Bitcoin mining and miners using surplus nuclear and hydro energy;
- Bitcoins seized during judicial proceedings will be transferred to the Treasury Department.
- A quarter of the funds deposited into Livret A and LDDS savings accounts will be directed to daily BTC purchases (approximately 15 million euros per day, 55,000 BTC per year).
- Payment of taxes in Bitcoin (subject to constitutional compliance).
Promoting euro-backed stablecoins
The second part of the bill defines euro-denominated stablecoins as an alternative to the Visa-Mastercard system, paving the way for their use in regulated everyday payments.
Suggested edits:
- Stablecoin payments of up to €200 per day are exempt from tax and social deductions.
- The use of euro stablecoins in tax payments is legalized,
- At the European level, they are demanding that the MiCA deregulation and the Digital Euro (CBDC) initiative be rejected by the EU Council on the grounds that they are “dangerous to economic freedom”.
Industry and mining support
Part 3 of the bill aims to support the French cryptocurrency and mining ecosystem in terms of energy and financing.
- Tiered electricity taxation and flexible TURPE tariffs are recommended for mining activities.
- Bitcoin and other crypto assets will be integrated into PEA investment accounts via ETNs (Exchange Traded Notes).
- It is proposed to reduce the risk weight of crypto assets in Europe by up to 1250% and open up opportunities for crypto-backed loans (Lombard loans).
The bill is not part of the current finance bill and was not drafted in conjunction with other political parties. Therefore, the bill has little chance of becoming law, as the UDR party only holds 16 of the 577 seats in parliament.
Nevertheless, this proposal stands out because it contains many of the demands long advocated by the French cryptocurrency community and offers some radical new ideas.
*This is not investment advice.
