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Policymakers in the French National Assembly voted in favor of an amendment that would ban influencers from promoting crypto assets which haven’t received a stamp of approval from government regulators.

Since no company currently holds a Financial Monetary Authority license – which is currently optional — influencers in France are essentially not allowed to endorse any digital asset. Those who violate the rules could face a two-year prison sentence as well as a fine of €30,000 ($32,000). 

French lawmakers approved the amendment in a bill addressing scams coming from influencers on social networks. Alongside crypto, the ban was also placed on gambling and certain pharmaceutical products and procedures.

The move comes as celebrity endorsements of digital assets have caught the attention of regulators around the world. In the U.S., the Securities and Exchange Commission targeted Kim Kardashian over an ad endorsing the token belonging to EthereumMax in a case that was settled with a $1.3 million fine last October.

A lawsuit last week claimed a group of social media influencers promoted fallen crypto exchange FTX to their followers without disclosure of compensation.

Changing regulatory landscape

In France, crypto firms currently have two options to become regulated — the first being registration and the second a hard-to-attain license. While major players like Binance, Societe Generale and, most recently, Circle have registered with the AMF, not a single firm has gained the license.

New rules are set to come into effect in January 2024, tiering up the registration requirements for new firms. These requirements will bridge over into the European Union’s Markets in Crypto-Assets regulation, which is expected to come into force later in 2024, but give firms additional time to transition. 

MiCA offers a passporting regime, meaning that a company licensed in one EU country can extend its services to any of the others in the 27-nation bloc. This regime may ease the implications of the ban on influencer’s crypto ads in the coming years.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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Circle chief executive officer Jeremy Allaire confirmed that a Twitter thread promising USDC holders a one-time bonus in the form of an airdrop was bogus. 

Allaire took to Twitter to say the account of the company’s chief strategy officer and head of policy had been hacked. A spokesman for the Boston-based company said in an email to The Block that the thread is “not legitimate.” 

The tweets came from the account of Circle’s Dante Disparte and claimed USDC holders would get a bonus after the stablecoin’s depeg earlier this month. The “one-time bonus” for USDC users would come in the form of an airdrop, according to the hacked account.

One tweet in the thread pointed to a URL that wasn’t on Circle’s domain.

Circle’s USDC stablecoin depegged the weekend of March 6 following the collapse of Silvergate and Silicon Valley Bank.

© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.