Financial institutions and technology companies in Europe are pressing lawmakers to accelerate the reform of distributed ledger technology regulations, cautioning that the region may lag behind the United States in the digital finance sector. A joint letter signed by 39 entities, including Boerse Stuttgart Group and Nasdaq, as well as fintech associations from various EU countries, has urged the European Commission and Parliament to separate the DLT pilot regime from a broader legislative package currently under review.
According to the signatories, handling the DLT rules independently would enable more rapid updates, as reported by Bloomberg. The DLT pilot, which has been in place since 2023, permits companies to test the use of tokenized assets, such as shares and bonds, for trading and settlement on blockchains.
The pilot is part of a larger set of 18 financial laws currently navigating the EU's legislative process, which industry groups claim could take several years to complete. The coalition is advocating for practical reforms, including the expansion of permitted asset types, the increase of transaction limits to 150 billion euros ($176 billion), and the elimination of license expiry dates.
They argue that these changes would provide companies with the flexibility to establish actual 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 cryptocurrency into mainstream finance. The European Commission has indicated its preference for passing the entire legislative package together as part of its broader strategy to mobilize savings into investments.