French Parliament Passes Bill That Allows Insurance Providers To Begin Investing In Cryptocurrencies
French insurance providers have been allowed to do cryptocurrency and token investments after the French parliament approved a new law.
As reported on by the FXStreet on April 11, the move by the French National Assembly means that insurance markets are free to take on unlimited crypto investments.
The bill will stimulate business and investment growth in France. According to news reports from Les Echos, a major financial paper in France, the new law passed in the National Assembly will enable redirecting of personalized savings to businesses.
Reuters reported that 147 members of the assembly voted for the bill while 50 voted against it.
The “Pacte” bill- “Plan d’action pour la croissance et la transformation des entreprises” allows France-based life insurers to invest in crypto assets, including top cryptocurrency Bitcoin (BTC). The law reportedly does not impose any restriction on the amount of money a business wishes to invest.
As FXStreet reported, the Act has a dual provision makes it possible for insurance companies to invest in cryptocurrency via specialized professional funds.
The insurance providers will also be able to offer life insurance covers through bitcoin (BTC) and other virtual assets.
Professional capital investment funds (Fonds Professionnel de Capital Investissement ( FPCIs)) will similarly be impacted by the new measure.
The amended Insurance Code from Article 21 of the Pacte law now allows the placing of specialized professional funds (FPSs) in the life insurance account units.
Also notable is a provision in Article 26b that ostensibly ensures that properties registered as blockchain-based forms part of those acknowledged under the FPS laws.
Emilien Bernard-Alzias, a Simmons & Simmons LLP lawyer said that the presence of the two provisions was a clear indication that FPSs could legitimately invest in crypto assets like Bitcoin. It also means that other businesses can now also join in these investments.
According to TrustNodes, Emmanuel Macron’s party La République En Marche confirmed the new initiative.
It, however, quotes the party’s deputy/budget manager Joel Giraud as claiming that the move to allow crypto-related investments in the insurance industry wasn’t the “primary objective of the Pacte.”
A large part of the bill focuses on the eventual privatization processes in various sectors, including the proposal to sell the state’s stake in ADP, an airport group company. The aim is to raise money to be used in a new innovation fund.
The bill passes at a time there are calls to increase regulatory oversight regarding cryptocurrencies in general. In March, French National Assembly’s head of finance Eric Woerth proposed an even tighter measure.
According to him, the country needed to impose a ban on anonymous coins, and mentioned Monero (XRM) and Zcash (ZEC), among others, as examples of such assets that need to be banned.
Disclaimer: This is not investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.