Financial institutions and tech companies in Europe are pressing lawmakers to accelerate the reform of distributed ledger technology regulations, cautioning that the region may lag behind the US in the digital finance sector. A joint letter signed by 39 prominent entities, including Boerse Stuttgart Group, Nasdaq, and various EU fintech associations, has urged the European Commission and Parliament to decouple the DLT pilot regime from a broader legislative package currently under review.
According to the signatories, this would enable more rapid updates, as reported by Bloomberg. The DLT pilot, launched in 2023, allows companies to experiment with tokenized assets, such as shares and bonds, on blockchain platforms. As part of a larger set of 18 financial laws making their way through the EU's legislative process, the pilot's progress may be hindered by a prolonged review period, which industry groups estimate could take several years.
The coalition is advocating for pragmatic reforms, including the expansion of permissible assets, an increase in transaction limits to 150 billion euros ($176 billion), and the elimination of license expiry dates. These changes, they argue, would provide companies with the necessary flexibility to establish full-fledged markets rather than limited trials. This appeal comes as the US is shaping its regulatory landscape, including the proposed Genius Act, aimed at further integrating crypto into mainstream finance.
The European Commission, however, has indicated a preference for passing the entire legislative package as a cohesive unit, aligning with its broader strategy to mobilize savings and stimulate investment.