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Will this help bring France closer to overtaking London as a European financial trading center?
Despite taking a very hard line when it comes to advertising and trading of leveraged financial instruments including Forex pairs and CFDs, France is looking to become a blockchain financial center. France’s Finance Minister Bruno Le Maire said in a statement that France will allow unlisted securities to trade on blockchain platforms.
If passed into law, the proposed rules mean that banks and fintech companies can set up blockchain-based platforms where unlisted securities can trade, cutting out the role of traditional middlemen such as brokers and custodian banks.
The rules will not affect listed securities, which will continue to trade on financial exchanges. Listed securities will still be required to pass through custodians and clearing houses.
Minister Le Maire was quoted as saying that:
“The use of this new technology will allow fintech firms and other financial actors to develop new ways of trading securities that are faster, cheaper, more transparent and safer,” with the proposed rules being “another asset for Paris’ attractiveness as a financial center”.
With Brexit creating a lot of uncertainty for financial institutions serving continental Europe, there is something of an arms race brewing between secondary financial centers including Paris, Frankfurt, Dublin and Milan to attract more financial jobs and activity, although each of these locations are still a long way from dreaming of supplanting London as a financial center.
The current move by the French government regarding Blockchain and unlisted securities is clearly another move in this direction.