It’s official, the company Ilium who operates the platform Cruxpool has just obtained its registration (nยฐE2022-48) as Digital Asset Service Provider (PSAN) with the agreement of theFinancial Markets Authority (AMF) and thePrudential Control and Resolution Authority (ACPR).
Ilium (Cruxpool) thus joins the still very closed club of companies holding this precious sesame and stands out as the first French mining pool to obtain it. In July 2022, Binance also announced its registration, as did Just Mining a few months earlier.
So what is the PSAN record and what is its role in the regulation of cryptocurrencies, a subject constantly debated in the ecosystem? For users, what is the concrete impact and is there an impact on mining?
The origins of the PSAN status
The cryptocurrency industry is still in its infancy. Although the beginnings of reflection have been present since the 90s through Cypherpunk ideals, the first applications of blockchain technology date back to 2008 with the appearance of Bitcoin. The founding thought is simple: allow everyone to recover their financial freedom through a system of decentralized exchanges and finance.
Once this environment was in place, it first evolved into an artificial and involuntary brooder; between scholars and initiates. The attraction of an untraceable โcurrencyโ precipitated all sorts of players to learn more about what had really just been created: a new way of conceiving exchanges.
Inevitably, this ecosystem ended up meeting that of the States and the regulations, necessary to stem the initial obscure aspects of the blockchain, in particular with the closure of the Silk Road site in October 2013. As time goes by, the technology is specified at the same time as its uses. The discovery of possibilities to apply certain characteristics of blockchain to health, sports, art; but also the emergence of controversies concerning mining in China or the adoption of Bitcoin as a national currency in El Salvador in September 2021 have made the entire ecosystem increasingly blurred in the eyes of external actors.
With this in mind, many States, including France, have decided to tackle the legislation of all areas related directly or indirectly to decentralized technologies. The PACTE law nยฐ2019-486 of May 22, 2019, from which the PSAN registration is derived, is a result of this approach.
The Role of PSAN Status
In addition to the PACTE law, Ordinance No. 2020-1544 of December 9, 2020 strengthens the framework for the fight against money laundering and the financing of terrorism (LCB-FT). It also extended the PSAN registration requirement to companies offering digital asset trading services and operating asset trading platforms. It is truly article 86 of decree n ยฐ 2021-387 of April 2, 2021 which establishes the mention of Service Providers on Digital Assets within the Monetary and Financial Code which acts as the pillar of blockchain regulation in France.
Designed primarily to protect users and prevent potentially malicious or illegal operations, the PSAN is a label indicating that the holding company applies strict control policies established by the regulator. This status concerns any company in the sector carrying out or wishing to carry out the activities below:
- Custody of digital assets;
- Buying or selling digital assets in legal tender;
- The exchange of digital assets for other digital assets;
- Operation of a digital asset trading platform;
In summary, any entity wishing to offer services related to the custody or exchange of digital assets is potentially affected by the PSAN status.
Questions raised by the intervention of regulators in the blockchain ecosystem: understanding the emergence of KYC
The growing presence of regulators and governments in the blockchain sector is highly debated. Theoretically opposed to the foundations of a decentralized ecosystem and to the original Cypherpunk thought, some take a dim view of the intervention of centralized and politicized legislative entities. Where Satoshi Nakamoto, the founder of Bitcoin, advocated a return to financial freedom for everyone; this utopia now comes up against the reality of a financial market that is constantly watched and monitored.
The whole problem is that unlike traditional finance, blockchain has an almost counterintuitive ambivalence. The appeal of this technology was initially, for many, anonymity. Each individual is represented by an electronic signature, an address, which is a series of random numbers and letters. Without a clear link established between a person’s hash and their identity, it is impossible to know what each transaction represents. For ordinary mortals, this allows you to recover a certain amount of freedom in the use and storage of your funds. For malicious actors, this is a unique opportunity to carry out illegal operations and participate in activities related to money laundering or the financing of terrorism – the fight against which constitutes the pillar of the PSAN.
Conversely, a blockchain such as Bitcoin or Ethereum are fully transparent by design. For them to work properly, each network participant must hold a copy of the main chain whose integrity requires consensus. It is therefore possible to observe in real time the operations carried out on โBlockchain Explorersโ such as etherscan Where BTCscanallowing everyone to keep a clear and archived history of all their transactions.
Regulators therefore find themselves with a new system, entirely transparent in terms of the amounts transferred, but entirely opaque in terms of identities. This disparity has contributed to the spread of account verification processes present on many sites such as Binance, Swissborg or Cruxpool (Ilium’s mining and staking platform); the famous KYC (Know Your Customer), which has become the quasi-standard in terms of identity identification.
PSAN: what impact for users?
Apart from the implementation of an identity verification procedure (KYC), none! If you use a platform that offers staking or decentralized finance services, the PSAN status first and foremost attests to the seriousness of the latter and its desire to offer the healthiest possible blockchain and crypto ecosystem. As such, since obtaining the status, Cruxpool now offers Ethereum staking services.
Staking, DeFi, miningโฆ Should we turn to a PSAN registered platform?
The choice of platforms used for your mining, staking, lending or any other decentralized finance service depends mainly on your expectations and the type of operations you want to carry out. Among other things, the profitability (APR) and the various fees charged are often much more decisive in terms of choice than the type of platform itself.
However, it is important to keep in mind that identity verification procedures are the result of regulators and that it is now normal for an entity present in the blockchain sector to comply with them. Trusting a PSAN-registered platform assures you that the company is recognized by the Autoritรฉ des Marchรฉs Financiers (AMF) and that a large amount of resources are deployed to offer you a healthy and secure environment, both for your funds and your personal information. This is the case for example for Cruxpool, a 100% French mining and staking pool (Ilium).
This text is a press release. Do your own research and only invest the money you can afford to lose.
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Follow our affiliate links:
- To buy cryptocurrencies in the SEPA Zone, Europe and French citizensvisit Coinhouse
- To buy cryptocurrency in Canadavisit Bitbuy
- To generate interest with your bitcoinsgo to the BlockFi website
- To secure or store your cryptocurrenciesget the Ledger or Trezor wallets
- To trade your cryptos anonymouslyinstall the NordVPN app
To invest in cryptocurrency mining or masternodes:
To accumulate coins while playing:
- In poker on the CoinPoker gaming platform
- To a global fantasy football on the Sorare platform
Stay informed with our free weekly newsletter and to our social networks:
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