France in Revolt: EU's Landmark Crypto Law on the Brink of Collapse
France is now threatening to block the entire MiCA regulation deal. The sticking point is a proposed cap on non-euro stablecoins like USDT and USDC, which are the lifeblood of the entire DeFi ecosystem.
So what's the right move here? Should Europe prioritize the Euro's sovereignty with strict caps, or should they allow dollar-backed stablecoins to flourish to keep their Web3 ecosystem competitive with the US and Asia?
19 Answer
Strict caps would protect the Euro but at the cost of immediately crippling the EU's DeFi ecosystem. The right move is a phased approach: allow dollar stablecoins to operate while aggressively building a competitive euro-denominated alternative. Killing the market today to protect theoretical sovereignty tomorrow is a losing strategy.
If France resists, EU crypto policy could shift massively. Exciting times!
Capping major stablecoins would be a strategic blunder for Europe. It prioritizes political currency ambitions over the reality of DeFi's infrastructure, risking irrelevance in the global Web3 race.
Sovereignty clashes with innovation.
This is a much more complex issue than just "France vs. Regulation." It's a fundamental conflict over the future of Web3 in Europe, and both sides have a valid point.
The regulators' and the European Central Bank's argument is about monetary sovereignty. They are looking 5–10 years into the future and see a world where the entire European crypto economy could be running on dollar-backed stablecoins. Such an arrangement would mean a huge part of their digital economy would be dependent on the US dollar, which is a risk they are not willing to take. They want to promote a native, euro-backed stablecoin market.
On the other side, you have France and the crypto industry. Their argument is about practical reality. The simple fact is that today, global DeFi liquidity runs on USDT and USDC. A strict cap on these assets would effectively cut the European DeFi ecosystem off from the rest of the world, making it instantly uncompetitive. All the developers, capital, and innovation would simply flee to more favorable jurisdictions.
So, France's move isn't necessarily "anti-regulation." It's a last-minute attempt to prevent the regulations from being so restrictive that they destroy the very industry they are trying to regulate. This is a high-stakes negotiation that will determine if Europe becomes a major player or just a spectator in the Web3 revolution.
This has nothing to do with protecting DeFi and everything to do with French politics. They likely want to extract some concessions or position themselves as the "pro-innovation" leader in the EU to attract crypto businesses to Paris. It's just a power play.
Good. Why should Europe allow its digital economy to be colonized by dollar-pegged assets? This is about protecting the Euro's future. The industry needs to adapt and build a robust Euro-stablecoin market, not just rely on American companies and the US dollar.
The EU is working on the digital € project to compete with these currencies. Unlike Bitcoin, it will be regulated.
I don't see the problem with it. It gives the EU more power to stop crypto scams and keep corporations from getting hacked and losing all their money, which happens a lot.
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