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Could the FRC be transformed into a induced for the administrative and legislative of services on digital assets - editor’s note .
Sovereign Fund? services. I think, as does the new AMF President, Marie-
It is clear that from its historic vocation as a Anne Barbat- ayani, that the information
reserve, the FRC must evolve and has already Could the joint use of the cloud and crypto section and the sanctions section need to be
evolved. It can become the armed wing of assets lead to the emergence in Monaco of a improved. Cryptocurrencies are not strategies
an economic, financial and environmental micro financial market, as some would like? suitable for everyone. There should be training
policy that corresponds to the objectives set There would be the same issues. France and for savers, service providers, promoters
by the Sovereign. Whilst the budget finances the EU attach great importance to ensuring of products or services and so on but also
investments based in the Principality, the FRC that Mon gasque legislation complies with strict regulations to sanction shortcomings in
can finance everything that is done outside the highest standards. We have demonstrated informing the client, in proposing inappropriate
our borders. It is a vocation that it did not agility in adapting our legislation in terms strategies according to the risk objectives
have historically but today the way in which of financial innovation, crypto assets and of the client. There is a balance between
it is invested means that it is naturally and metaverses but we must constantly weigh innovation and the search for a quick and
gradually transforming into a Sovereign Fund. the balance between profitability and risk. significant profit. We cannot pretend that
It should be noted that a certain number of Beyond the innovative image of Monaco, money grows on trees! One of the main forces
such funds orway and atar, for example which is essential, the reputational risks to remember is correlation. Beyond the real
- editor’s note are very dependent on fossil are significant. In terms of ecosystem, we damage to the environment linked to the
fuels. We do not have a Sovereign Fund can incubate FinTech within MonacoTech creation of cryptocurrencies, there is a purely
powered by fossil fuels. With our sustainable but what role can we realistically play We financial logic: if an asset retains high volatility
strategies, we are doubly virtuous. are currently discussing these issues with but is more correlated to strategies that are
resident entrepreneurs who have been active less so, it loses its attractiveness. The saver
So the FRC has not suffered too much from in this area and are available to help us move needs to be aware of this! We have seen the
market volatility? forward on this subject. They help us reflect limits of alternative funds, particularly in the
o, thanks to its ever-increasing diversification. on what has worked elsewhere and what can Madoff affair. We are moving in the field of
We currently follow about 50 lines, with be implemented. cryptos towards an evolution of this type. On
diversified funds (which mainly use liquid the Mon gasque side, a Sovereign Ordinance
assets such as stocks and bonds invested Has the FRC taken the plunge and invested will soon complete the legislation on aspects
in international markets) but also specialised in crypto? of control and sanction.
strategies, on very specific asset classes o, because for me it remains a strategy of
(including a fund 100%-invested in green high volatility, as the last few months and The government wanted to attract businesses
Midcaps). We see to what extent, in a year the recent bankruptcy of FT have shown. via Initial Coin Offerings (ICO), serving
like 2022, there is an interest in using private In the portfolio of a W private client, companies linked, for example, to the
equity in terms of shock absorption, thanks to where the play money accounts for 2-10% of green economy or health. The director, Luc
the return we get from it that is uncorrelated the portfolio, it is risky but why not have an Jacquet, was thus able to benefit from the
from the markets. The FRC also has a strategy investment in cryptocurrencies, specially if this first ICO. The objective was a dozen or so
in the field of hedge funds which plays its investment is uncorrelated from other asset operations of €30 to €50 million per year
role of shock absorber in 2022 and delivers classes, much like gold. For an institutional and the creation of 100 to 150 jobs within
positive profitability, unlike liquid strategies investor, on the other hand, stability must the incoming companies. What is the current
subject to the vagaries of the markets. prevail, so this type of investment does not situation?
seem advisable to me, particularly since it is We have realised, in this case as in others,
FINANCIAL MARKETS/CRYPTO no longer as uncorrelated from other assets that investors currently prefer to favour more
ASSETS as in the past. An institutional investor seeks, traditional investment methods. Even in
Why is there no stock market in Monaco? Is above all, decorrelation and diversification, private equity where innovation is the norm,
it just a matter of the size of the country? in addition to performance and social and they prefer using currencies like the euro or
The size of the territory is an obstacle environmental objectives. dollar over issuing tokens. The fairly strong
but it is not the only reason: the Franco- enthusiasm that had manifested before the
Mon gasque agreements and the European Should we transpose banking regulations Covid crisis did not pan out in the same
Convention mean that to have a stock market to the world of cryptocurrencies? manner. Particularly with a year 2022 marked
in the Principality, it would be necessary to It is an essential prerequisite. I reference the by the resumption of inflation, the rise in rates
transpose into internal law a certain number work of regulators in Europe. In France, the and an international financial environment
of regulations and European directives. It AMF financial markets authority has published disturbed by the crisis in Ukraine, investors
would be a long and complicated exercise. information on the precautions to take before are less able to innovate to support certain
We must ask ourselves what this could bring investing in crypto assets. ew rules are due to projects. The use of ICOs and STOs is therefore
financially and economically and, on the apply in early 2024 better to protect European less all these things are still of interest but
other hand, what it could require in terms savers against scams and provide a legal past excesses will not be seen again and that
of adapting the legislation and the burdens and supervisory framework for the provision is a good thing.

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