For a few days, Paris becomes the world capital of cryptocurrencies.
Coincidentally, several blockchain players have come forward with announcements, all of which testify to the maturity of this young industry. Ledger, a cryptocurrency wallet maker, is joining forces with Franco-Chinese Cathay Capital to launch an “ecosystem fund”: with the support of Bpifrance, which will be the first subscriber, the two partners will invest 100 million euros in “Web 3” startups based on blockchain technology.
Digital currency broker Coinhouse raises 40 million euros to accelerate its development. Finally, young management company Arquant has just received AMF approval and will be the first in Europe to actively manage a fund that invests in bitcoin and ether.
Added to this is a symbolic announcement: from June 8, the Parisian department store Beaugrenelle will allow you to pay for purchases in cryptocurrencies. “Thanks to its engineers from Grandes Ecoles, strong experience in asset management, good financial culture, the Parisian place is consolidating assets to become the European headquarters of crypto,” Judge Yvan de Lastour, blockchain and crypto pilot at Bpifrance.
The history of Ledger and Coinhouse symbolizes this evolution. The two companies were born in 2017 by the same Maison du bitcoin organization founded in 2014 in Paris by Eric Larcheveck and Thomas France. Animated by a community of enthusiasts, this physical space was both a blockchain solution editor and a learning space to which the Ledger security solution was added.
“Financial Revolution”
The startup Coinhouse now employs about a hundred people, symbolically, in the former headquarters building of Crédit Lyonnais, right in the center of Paris. Profitable since October 2020, its turnover is about 15 million euros.
“The tokenization of finance is inevitable, this is a fundamental revolution in the financial world that is happening,” says Nicolas Louvet, CEO of Coinhouse. Now in her position as a crypto investment advisor, she has retained her preaching spirit. “My goal is to convince Monsieur and Madame Tout-le-Monde to invest: 40 million people in France, 150 million in Europe,” declares his boss, a former venture capitalist. Modeled as a classic asset manager, Coinhouse offers a free account and is rewarded with transaction fees ranging from 0.5% to 2.49%. It also helps large groups accept cryptocurrency payment methods. An activity that already accounts for 5% of its turnover.
Marks in the Metaverse
Another emanation of the House of Bitcoin, Ledger has established itself as a global leader in Web 3 security. Its physical and digital wallets protect between 15 and 20% of digital assets (cryptocurrencies, NFTs and tokens) in the world. The needs are huge. “The owner of a private crypto key (equivalent to the password of a digital safe) can be stolen in an instant,” emphasizes Pascal Gauthier, its CEO. Unicorn has just signed a partnership agreement with Coinbase, the third largest crypto exchange in the world.
Born later, two other French companies have become world-class players. The Sorare unicorn dominates the world of digital sports tokens thanks to Panini 2.0 cards. And the game The Sandbox, which just raised $500 million, created a metaverse that became necessary: 200 brands burst into its hybrid virtual world, between a video game, a social network and a mall. Under the influence of these four locomotives, a whole ecosystem arises.
Some actors move with great speed, like Kaiko. The startup, founded by Ambre Subiran, a former HSBC banker, aims to be the “Bloomberg” of the sector: it wants to serve as a single source of market information. Another nugget backed by the US Tiger Foundation, Arianee helps large groups create “digital tokens” for all sorts of uses: loyalty, anti-counterfeiting, promotion…
The fall of bitcoin (-50% in six months) thus did not cool the seething ecosystem. On April 13 and 14, over 3,000 people rushed to Blockchain Week in Paris. Gone are the days when cryptocurrencies were reserved for geeks speaking cryptic jargon: the lines between specialized players and traditional industries are blurring. For a long time, reluctantly, finances open up a little, with the support of public authorities. Payments Specialist Lydia makes the exchange of cryptocurrencies possible through a partnership with BitPanda. French venture capital, still cautious, is also coming into play: Alven has just announced the creation of a $350 million fund focusing on fintech and cryptocurrencies. The same tremor in asset management. “Demand from family offices and asset managers is very high,” says Heron Angele, managing director of young professional management firm Arquant.
Strategic experience
And in recent months, interest in cryptocurrencies has moved beyond finance thanks to the metaverse and NFTs (unique digital tokens). “Whether in luxury, sports, automotive, fashion, leisure, there is no longer a boss who doesn’t question his Web 3 strategy,” notes Pierre-Nicolas Herstel, founder of Ariane. There are many examples: Samsung, Gucci, Carrefour, Adidas… have bought land in the sandbox. However, this experience encourages companies to consider managing cryptocurrencies. “How can you be sure of their origin? Manage accounting and financial reporting? When to convert them to euro? There are so many new topics that treasurers have to deal with,” explains Pierre-Nicolas Herstel. His message: get ready, structure yourself. An announcement that went unnoticed, the Arnault family will be investing through their Aglaé Ventures fund in crypto projects. Even if the godfather of French capitalism intervenes…
Paris points the way to Europe
France got regulated before anyone else, David Princey, general manager of Binance France, enthuses. It is ahead of other European countries, itself ahead of the rest of the world. This is why Binance chose Paris. Since 2019, Bruno Le Maire has been insisting that he wants to make France a “crypto nation”. The Pacte Act then laid the legal groundwork by creating the Digital Asset Service Provider (PSAN) status, which was adopted by 37 institutions, including most recently Binance.
“Founded by a Chinese entrepreneur, Binance first grew in gray areas before asking for his approval, while French players, left very small, played the regulation game,” the specialist squeaks. However, while blockchain participants find the French framework quite benign, European regulation, which is in the process of being finalized, is troubling. The Mica Directive (Crypto Asset Markets) does contain gray areas that could hinder operators. “You might have thought that Europe was going to adopt Web 3, but too much regulation risks breaking the momentum,” laments Pascal Gauthier.