Crypto regulation laggards spur arbitrage risk – French central banker

According to the director of France's central bank, countries that take too long to develop legislation for crypto assets might expose themselves to arbitrage risks that players operating internationally could take advantage of.

In an effort to establish standards throughout the world, the European Union suggested in July that businesses in the 27-nation bloc get a license and provide consumer protections before issuing and selling digital tokens.

However, the worldwide market for crypto assets, including cryptocurrencies like bitcoin, is still mostly uncontrolled.

Francois Villeroy de Galhau, governor of the French central bank, expressed his optimism that the EU legislation will be officially enacted by March of next year and noted that other unidentified "important countries" were less developed.

Villeroy said at a symposium on digital banking in Paris that "we need be particularly vigilant to avoid implementing divergent or contradicting laws, or regulating too late."

He said that doing so "would be to create an unequal playing field, risking arbitrage and cherry picking" and that "unduly complicated" legislation would not be sufficient to adequately safeguard customers and stop money-laundering.

While the US is still working to find any regulatory loopholes, the EU has moved forward with new crypto-asset legislation.