French Parliament Mulls New Cryptocurrency Law: Establish National Bitcoin Reserve, Plans to Purchase 2% of Global Supply

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Major progress has been made in the French cryptocurrency sector, as a supportive bill has been submitted to the French parliament.

On October 29, according to media reports, the bill was proposed by the UDR party led by MP Éric Ciotti, advocating for the establishment of a national Bitcoin strategic reserve and granting it the strategic status of “digital gold” to strengthen financial sovereignty.

According to media citing journalist Gregory Raymond, under the proposed bill, France’s goal is to purchase 2% of the total Bitcoin supply, about 420,000 Bitcoins, within the next seven to eight years. At the same time, the bill plans to set up a dedicated public institution to manage this reserve, with a structure similar to France’s existing gold and foreign exchange reserve management system.

The bill also proposes using surplus nuclear and hydroelectric power for public Bitcoin mining, and allowing citizens to pay part of their taxes in Bitcoin.

Objectives and Sources of Funding

To establish the Bitcoin reserve, the bill lays out diversified sources of funding.

First, the bill suggests using France’s surplus nuclear and hydropower for public Bitcoin mining operations. This builds upon a proposal from July this year, which aimed to convert surplus electricity into economic value through Bitcoin mining, in order to solve the “unacceptable economic and energy losses” caused by France having to sell surplus power at a discount.

Secondly, the bill allows for cryptocurrencies confiscated in legal proceedings to be kept and included in 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. Among them are the adjustment of electricity tax policies for crypto mining, through measures such as progressive excise taxes and flexible electricity prices for data centers.

In addition, the bill encourages institutional investors to use Bitcoin and other crypto assets via exchange-traded notes (ETN). The proposal also calls for revising European prudential regulatory rules, as current rules impose high risk weights on certain crypto assets, which restricts their use as collateral for “Lombard loans.”

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

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