A coalition of 39 prominent European financial firms and technology groups is pressing lawmakers to accelerate the evolution of distributed ledger technology regulations, cautioning that the region may lose ground to the US in the digital finance arena. In a joint letter to the European Commission and Parliament, signatories including Boerse Stuttgart Group and Nasdaq, along with fintech associations from several EU countries, requested that the digital ledger technology pilot regime be decoupled from a broader package of 18 financial laws currently under review. By handling these rules independently, the firms argue that updates can be implemented more swiftly, according to Bloomberg.
The DLT pilot, established in 2023, enables companies to experiment with the use of blockchains for trading and settling tokenized assets like shares and bonds. However, its inclusion within a larger legislative package, which is progressing through the EU's legislative process, may lead to years of delay, according to industry groups. The coalition is advocating for practical reforms, such as broadening the range of permissible assets, increasing transaction limits to 150 billion euros, and eliminating license expiry dates.
These changes, they contend, would provide firms with the latitude to establish substantial markets rather than limited trials. This appeal comes as the US is shaping its regulatory framework for the industry, 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 collectively as part of its strategy to mobilize savings into investment.