PwC France Partner: Digital Assets Are for Corporations, Not Central Banks

France’s central bank won’t issue its own digital currency in the near future according to Pauline Adam Kalfon, PwC France blockchain and cryptocurrency partner. Kalfon admits that cryptocurrency has a growing interest and there have been several recommendations to explore the idea further, but says it would be complex to deploy.

“France’s central bank may not be the best entity to drive forward such a digital currency project, which would sit within the prerogatives of the European Central Bank. Having said this, Banque de France could seize technological leadership by following European Central Bank guidance. It is clear that a European-level project would be very complex and challenging governance-wise, requiring alignment and the political consensus of all relevant stakeholders from each Member State.”

Kalfon argues that digital currencies would be best left to corporations such as JPMorgan and Facebook, rather than a central bank.

She added:

“This would reduce the likelihood of potentially negative consequences on the economy arising from any central bank issuing a digital currency.”

Central banks around the world are stuck somewhere between acknowledging the future potential of crypto, and deciding whether it is something they can viably pursue. In February this year, South Korea’s central bank said it would not introduce its own digital currency, and issued a warning about central bank digital currencies one week later.

In January 2018, Bruno Le Maire, the French minister of the economy warned France about the dangers and risks involved in cryptocurrency. In 2019 the French equivalent of the Securities & Exchange Commission also warned that cryptocurrency could disrupt the finance industry and that further regulation is necessary.

Eric Woerth, President of the Finance Committee of France’s Nation Assembly also stated:

“We must be aware of the problems that cryptocurrencies can pose in terms of fraud, tax evasion, money laundering or fraud, or energy consumption’, Woerth states in his opening remarks.”

“It would also have been appropriate to propose a ban on the dissemination and trade in cryptocurrencies built to ensure complete anonymity by preventing any identification procedure by design”

He also added that any regulation so far has not gone far enough.

It’s clear that France sends some mixed messages when it comes to crypto. Despite Le Maire’s strongly worded warnings about crypto, he has also supported the advocating of blockchain technologies. Kalfon’s statement could also be seen as hopeful - she’s not saying never, but rather that if cryptocurrency proves a successful endeavor for corporations, then it will be considered.