In a pivotal move for the burgeoning world of crypto-powered gaming, the French National Assembly has taken a significant stride towards recognizing NFT-based video games as a unique entity, separating them from traditional gambling. The newly proposed Jonum regime, part of the broader Digital Space Regulation Law (SREN), has made its way through the National Assembly, though it still awaits final approval by the Constitutional Council.
Reforming the Digital Gaming Landscape
The Jonum regime, affectionately referred to as the “Sorare Law,” is poised to revolutionize the digital gaming landscape. With 437 members in favor and 77 members opposing it, this legislation seeks to establish a dedicated regulatory framework for video games that leverage NFTs and crypto-driven monetization mechanisms.
Defining the Jonum Realm
A groundbreaking aspect of this legislation is the formal definition of the “Jonum” category. This term, a portmanteau of “Jonum” and “premium,” creates a distinct category for crypto games, differentiating them from both gambling and traditional video games. This move is anticipated to foster innovation among French gaming startups while simultaneously safeguarding the interests of users.
Industry Validation
Karima Lachgar, CEO and head of the group’s legal and regulatory strategy at Olky Wallet emphasized the significance of this legislation by saying, “SREN may contribute to legitimizing the sector, which is fast-growing and has suffered from scams the last few years.”
Constitutional Council Scrutiny
Before becoming law, the text must face examination by the Constitutional Council. There are ongoing discussions, with some deputies hoping for possible rejection. Critics have argued that this legislation may give preferential treatment to crypto games over online casinos.
A Potential Shift in the Gambling Landscape
If the law ultimately passes, gambling platforms could be compelled to explore new horizons. Lachgar has even speculated that under the new regulations, these platforms might venture into the “play-to-earn and Web3 sector like PMU.” Pari Mutuel Urbain (PMU) is a state-controlled betting system, which has already entered the crypto space through its fantasy horse racing game Stables.
Promoting Growth in the Web3 Gaming Sector
While the Jonum regime is not yet set in stone, it signifies a hopeful future for the French crypto-gaming industry. Previously, French regulators had classified assets used in crypto games as having the characteristics of gambling. This misclassification potentially subjected popular crypto games to heavy tax burdens.
Under the Jonum regime, the Autorité Nationale des Jeux (ANJ), the French National Gambling authority, will be tasked with ensuring compliance. Users will need to disclose their age when creating an account for a crypto game and confirm their identity when withdrawing in-game earnings. Importantly, identity verification during registration remains unnecessary.
Additionally, this legislation has implications for the promotion of Web3 games through influencers. It restricts influencers from engaging in promotional activities on online platforms that cannot exclude minors, indicating that promotional efforts on platforms like YouTube may remain unaffected.