On 19 June, Autorité des Marchés Financiers (AMF) – the French financial market supervisor – published a report on decentralised finance (DeFi) that examines the challenges that will be faced by the French regulators.

Although the report fails to present the official position on how the regulatory authorities in France can address DeFi, the report states that they perceive DeFi as a growing priority and are reflecting on how to mitigate the risks involved. The report argues that the events in the crypto markets in 2022, and especially the collapse of TerraUSD stablecoin, show that the DeFi markets remain immature and create risks for the stability of the financial system. The report also highlights that DeFi creates financial crime risks because the protocols, in general, do not provide for the application of anti-money laundering (AML) measures. The regulations should address all those risks.

Source:

https://www.amf-france.org/sites/institutionnel/files/private/2023-06/AMF%20Discussion%20Paper%20on%20Decentralised%20Finance%20VEN.pdf