The French Government passed a new on Thursday, April 11, 2019, that enables the Insurance companies to invest in Blockchain projects and cryptocurrencies, as reported by Les Echos. The Total volume of the French Insurance market is estimated to be $2 trillion.
The French lawmaking body passed the Pacte Law “Plan d’action pour la croissance et la transformation des entreprises”; the law was formed to foster the growth of businesses entities in the country; while 50 senators voted against the law, 147 voted in favor of the law.
“…insurers will actually be able to offer products based on crypto-assets. They will be able to do that through specialized funds.”
This was made possible by two provisions in the new law. First of those enabled the placement of a Specialized Professional Fund (SPF) in life insurance projects. Moreover, Article 26 of the France Monetary and International Code was amended to include any good subject “registration in a shared electronic recording device.”
Emilien Bernard-Alzias, a lawyer at Simmons & Simmons LLP said:
“With these two provisions, it is written in black and white that FPS can invest in crypto-active like bitcoin,”
The insurance companies often invest in certain financial assets to hedge against the loss due to the insurance claims. Until now Bitcoin and cryptocurrencies were considered as high-risk investments due to the volatility and the FUD against its acceptance as a valid asset class around the world. However, the inclusion of these assets now will surely benefit the long term stability and growth of the cryptocurrencies and Blockchain projects.
France has usually been lenient towards the crypto-regulations earlier as well. The Government also provides a framework for tax and other guidelines for investment in Bitcoin and cryptocurrencies.
Do you think the insurance companies which will include crypto-assets would outperform the traditional insurance companies? Please share your views with us.
Nivesh from Engineering Background is a full-time Crypto Journalist at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com