France's National Assembly Clears NFT Games from Gambling Label
The recent vote may reshape the Web3 gaming scene in France by dissociating crypto games from traditional gambling.
The French National Assembly passed the "Sorare law" on Tuesday, leading to its first dedicated regulatory framework for video games monetized with cryptocurrencies and NFTs.
561 Assembly members voted on the Digital Space Regulation Law (SREN), which resulted in this decision. 437 voted in favor, while 77 opposed, creating a distinction between crypto gaming and gambling.
The term "Jonum regime" has been coined for video games with monetizable virtual assets. A notable aspect of this ruling is that it marks the first legal recognition and definition of Jonum, indicating that crypto games will be treated differently from traditional gambling and video games.
Karima Lachgar, CEO of Olky Wallet, expressed optimism, stating, "SREN may contribute to legitimize the sector which is fast-growing and had suffered from scams the last few years."
However, this ruling has not been set in stone. Several deputies are still hoping for the Constitutional Council to reject the draft, which has the authority to review and reject it.
As reported by Les Echos, several opponents argue that the law favors crypto games over online casinos. Under the new framework, gambling platforms like PMU might pivot towards the booming play-to-earn sectors, according to Lachgar. PMU, or Pari Mutuel Urbain, is a state-controlled betting system. It has entered the crypto gaming space via its fantasy horse racing game Stables.
That said, the new ruling now offers more clarity to the Web3 gaming scene in France. Crypto games had previously been categorized as gambling by authorities, putting them at risk of heavy taxation. The ANJ (Autorité Nationale des Jeux), France's National Gambling Authority, will ensure compliance under the new framework. This includes age declaration during account creation and ID verification for withdrawal of in-game earnings. However, the latter is not required during registration.
The regime also includes measures that impact the promotion of Web3 games using influencers. For instance, it prohibits the use of influencers for promotional activities on online platforms that cannot exclude minors. Reports suggest that promotional efforts on major social media channels like YouTube may not be affected.