French Parliament Proposes New Cryptocurrency Law: Establishing National Bitcoin Reserves, Plans to Purchase 2% of Global Supply

According to the proposed bill, France aims to purchase 2% of the total bitcoin supply, approximately 420,000 bitcoins, within the next seven to eight years.

Written by: Li Jia

Source: Wallstreetcn

The French cryptocurrency sector has seen a major breakthrough, as a supportive bill has been submitted to the French parliament.

On October 29, according to media reports, the bill was introduced by the UDR party led by MP Éric Ciotti. It advocates for the establishment of a national bitcoin strategic reserve and grants it the status of "digital gold" to strengthen financial sovereignty.

According to journalist Gregory Raymond, as cited by the media, the proposed bill sets France’s goal to acquire 2% of the total bitcoin supply, about 420,000 bitcoins, over the next seven to eight years. At the same time, the bill plans to establish a dedicated public institution to manage this reserve, structured similarly to France’s existing gold and foreign exchange reserve management system.

The bill also proposes utilizing surplus nuclear and hydropower energy for public bitcoin mining, and allowing citizens to pay part of their taxes in bitcoin.

Objectives and Funding Sources

To establish the bitcoin reserve, the bill outlines diversified funding sources.

First, the bill suggests using France’s surplus nuclear and hydropower generation for public bitcoin mining operations. This continues the idea from a proposal in July this year, which aimed to convert surplus electricity into economic value through bitcoin mining, addressing the "unacceptable economic and energy losses" caused by having to sell excess electricity at a discount due to overproduction in France.

Second, the bill allows cryptocurrencies confiscated in legal proceedings to be retained and incorporated into the national reserve.

Finally, the proposal plans to allocate a quarter of the funds raised by popular savings plans, such as Livret A and LDDS, to daily bitcoin purchases, amounting to about 15 million euros per day.

Incentivizing Mining and Institutional Participation

To support cryptocurrency development, the bill also mentions a series of supporting policies. These include adjusting electricity tax policies for cryptocurrency mining through progressive consumption taxes and flexible electricity pricing for data centers.

In addition, the bill encourages institutional investors to use bitcoin and other crypto assets through exchange-traded notes (ETN). The proposal also calls for revisions to European prudential regulatory rules. Current rules impose high risk weights on certain crypto assets, limiting their use as collateral for Lombard loans.

However, the bill faces significant challenges. According to Gregory Raymond, UDR holds only 16 out of 577 seats in the National Assembly.