Fintech Paris

France runs a dual supervisory structure. The Autorité de contrôle prudentiel et de résolution supervises credit institutions, payment service providers and insurers, and it sits inside the Banque de France: the prudential supervisor and the central bank share a building and a staff pipeline. The Autorité des marchés financiers supervises investment services and digital asset service providers.

The split is by activity and not by firm size, so a firm offering both payment services and investment services deals with both. For a crypto business the AMF is the relevant authority, and for a payments business the ACPR. A firm that is both, which many are, ends up in front of both, and the two run a joint fintech forum precisely because the boundary is where firms get stuck.

Before MiCA, France had its own regime for digital asset service providers, the prestataire de services sur actifs numériques or PSAN, registered with the AMF. The position of the AMF on territorial scope was broad: a digital asset service counts as provided in France when the provider has facilities in France, and also when the provider takes the initiative of offering it to customers resident or established in France. That second limb catches a firm with no French presence that markets into France.

MiCA has replaced the regime, and the transition was eased by design. The AMF aligned the PSAN approval requirements with MiCA's crypto-asset service provider requirements, which gave registered firms a simplified route to MiCA authorization. A firm that had done the French work had done most of the European work.

The lesson for anyone choosing a jurisdiction now is that the supervisor's institutional experience matters more than the rulebook, because the rulebook is the same across the EU. The AMF has been examining crypto business models since before MiCA existed. Finance Loop covers the regime at MiCA in Europe and the authorization at the CASP license.

The Banque de France launched a wholesale CBDC experimentation program in March 2020 and ran twelve experiments across two tranches, publishing its conclusions and the lessons it drew from them.

The program demonstrated three models for issuing a wholesale CBDC on a distributed ledger. In the interoperability model, the existing central bank system connects to a DLT platform. In the distribution model, the central bank issues onto a DLT operated by someone else. In the integration model, the central bank itself operates on the DLT. The second report of the Banque de France covers both tranches, tested across different ledger types, with tokenized finance and cross-border payment improvement as the two application areas.

The three models and experimental results inform European discussions of wholesale settlement. The exploratory work of the ECB on wholesale DLT settlement builds on the same question. Finance Loop covers the European picture at CBDC in Europe and the digital euro at the digital euro.

France amended its securities law for distributed ledgers earlier than most member states, allowing unlisted securities to be registered in a DLT-based register, and French banks used it. Several large French institutions ran tokenized bond issues and settlement pilots, and the combination of a permissive register and a central bank running settlement experiments gave French issuers somewhere to test both halves of a transaction.

For a German issuer the comparison is with the eWpG route and its BaFin-supervised registrar. The French and German regimes reached similar places with different mechanisms, and a cross-border structure usually has to choose one. Finance Loop covers the German route at issuing tokenized securities in Germany and the Luxembourg one at tokenization in Luxembourg.

Paris Fintech Forum brings financial institutions and technology companies together. The AMF and the ACPR also convene a joint fintech forum to discuss supervisory questions with market participants.

The event organized by Finance Loop is AI in Finance Paris, which brought the network's AI and wealth management discussion to the city. The French market is close enough to Frankfurt that members attend in both directions, and the subjects that travel are settlement, tokenization and AI governance.

Both cities gained from Brexit and they gained different things. Paris attracted banking and markets staff, particularly in trading and investment banking, and several large institutions moved substantial headcount there. Frankfurt gained the supervisory center of gravity: the European Central Bank is there, ECB banking supervision is there, and the banks that needed an EU entity under direct ECB supervision located it in Frankfurt.

Amsterdam took the cash equity trading, as covered at fintech in Amsterdam. Business previously conducted in London was distributed across several cities, and a firm with European operations now deals with several centers instead of one. Finance Loop covers the German center at Frankfurt and the European AI picture at AI in finance in Europe.

Two authorities share responsibility for supervision according to the financial activity. The ACPR, which sits inside the Banque de France, supervises credit institutions, payment service providers and insurers. The AMF supervises investment services and digital asset service providers. A crypto business deals with the AMF, a payments business with the ACPR, and a firm doing both deals with both. The two run a joint fintech forum because the boundary between them is where firms have questions.

PSAN was the French national regime for digital asset service providers, registered with the AMF, which predated MiCA. The French national regime's territorial scope was broad: a service counted as provided in France when the provider had facilities there and also when the provider took the initiative of offering it to customers resident or established in France. MiCA has replaced it, and the AMF aligned the PSAN requirements with MiCA's so that registered firms had a simplified route to MiCA authorization.

They demonstrated the operational feasibility of three models for issuing a wholesale central bank digital currency directly on a distributed ledger: an interoperability model connecting the existing central bank system to a DLT, a distribution model where the central bank issues onto a DLT run by someone else, and an integration model where the central bank operates on the DLT itself. The program launched in March 2020 and ran twelve experiments across two tranches, with tokenized finance and cross-border payments as the application areas.

They are better at different things, and both gained from Brexit. Paris attracted trading and investment banking headcount and has a central bank that runs its own settlement experiments. Frankfurt has the European Central Bank, ECB banking supervision and the derivatives market, which is why banks needing an EU entity under direct ECB supervision located there. A firm's answer depends on which supervisor it needs and where its counterparties are. Amsterdam, meanwhile, took the cash equity trading.