The changes passed by the lawmakers affected the Insurance Code consequently expanding Article 21. The expansion allows life insurance contracts to find their way into SPFs (specialized professional funds). Previously, the investments into specialized professional funds had excluded the cryptocurrencies. Changes made to Article 21 and Article 26 open the door for SPFs to invest in Bitcoin and other blockchain-backed assets.
“With these two provisions, it is written in black and white that SPFs can invest in cryptocurrencies like Bitcoin,” noted Emilien Bernard-Alzias, Attorney, Simmons & Simmons.
Notably, there are no minimum, or maximum limits a life insurance policy can invest in virtual currencies. This allows those with life insurance policies to increase the value of the policies when Bitcoin rises in value.
The decision to have SPFs invest in cryptocurrencies is not an afterthought. Lawmakers, companies, and entrepreneurs have been working together in the last 12 months to help make it a reality. On the sidelines, the policy change allows French locals to invest in cryptocurrencies.
The changes made to Article 21 and 26 allowing SPFs to invest in cryptocurrencies may propel other jurisdictions to seek policy changes to allow the entrance of Bitcoin.
A member of France’s National Assembly, Joel Giraud, was quoted by Les Echos, a local media outlet, saying:
“This was not the primary goal of Pact, but insurers will actually be able to offer products based on crypto-assets. They will be able to do so through specialized funds.”
The voting in favor of the new changes was almost unanimous with 147 members voting in favor and only 50 voting against. Bruno Le Maire, France’s Economy Minister, noted that the lawmakers would “continue transforming” France’s economy.
The policy change is significant given that insurance policies among French households account for 40 percent of financial assets. Investors have also turned to insurance products due to the high returns realized compared to other savings vehicles.