A coalition of 39 European financial institutions and technology companies is urging lawmakers to accelerate the revision of regulations governing distributed ledger technology, citing the risk of the region falling behind the United States in the digital finance sector. In a joint letter addressed to the European Commission and Parliament, signatories including Boerse Stuttgart Group, Nasdaq, and various EU fintech associations requested that the DLT pilot regime be detached from a broader package of 18 financial laws currently under review. This would enable more rapid updates, according to Bloomberg.
The DLT pilot, established in 2023, permits firms to experiment with the trading and settlement of tokenized assets, such as shares and bonds, using blockchain technology. However, as part of a larger legislative package, the process may take years to complete. The industry coalition is pushing for practical reforms, including the expansion of permitted asset types, an increase in transaction limits to 150 billion euros, and the elimination of license expiry dates. These changes, they argue, would provide firms with the necessary flexibility to establish substantial markets rather than limited trials.
The letter coincides with the US's efforts to regulate the space, including the proposed Genius Act, aimed at integrating crypto into mainstream finance. The European Commission has indicated a preference for passing the entire legislative package as part of its strategy to mobilize savings into investments.