In a coordinated effort to influence European regulation, a broad coalition of financial market participants—including major exchanges such as Nasdaq and the Börse Stuttgart, as well as a range of fintech firms, asset managers, and blockchain innovators—has formally addressed the European Commission with a request to either eliminate or substantially increase the existing cap on the amount of assets that can be tokenised under the EU’s pilot programme for distributed ledger technology (DLT) assets. The coalition’s letter, signed by representatives of more than a dozen organisations, argues that the current ceiling of €100 million per tokenised asset is far too restrictive for the scale of projects already underway across the continent and threatens to stifle the development of a vibrant digital‑assets market in Europe. The EU’s DLT pilot, launched in 2021, was designed to provide a controlled environment in which market participants could experiment with the issuance, trading, and settlement of tokenised securities, while regulators gathered data to inform future policy.
As part of the framework, the Commission set a maximum value of €100 million for any single tokenised instrument that could be offered to investors during the trial period. The intention was to limit exposure and manage risk while the technology was still being tested. However, the coalition now contends that the cap no longer reflects the realities of the market, especially as several high‑profile projects have already exceeded the threshold in practice. Among the examples cited are cross‑border bond issuances that have been tokenised to improve liquidity and reduce settlement times, as well as equity token offerings from mid‑size companies seeking to tap a broader investor base through digital channels.
In at least three cases, the total value of the tokenised securities has topped €150 million, prompting the coalition to argue that the cap is being breached in practice, creating legal uncertainty for participants and potentially exposing them to regulatory sanctions. The coalition’s position is that the cap should either be removed altogether, allowing market participants to determine appropriate limits based on risk assessments, or at the very least raised to a level that accommodates the scale of existing projects—suggesting a new ceiling of €500 million or more. Nasdaq, as one of the world’s largest exchange operators, highlighted how the cap hampers its ambition to expand tokenised offerings across Europe. The company explained that its DLT‑based platform, which aims to provide near‑instant settlement and fractional ownership of securities, is already being used by several issuers whose tokenised assets exceed the current limit.
By keeping the ceiling at €100 million, the regulator forces these issuers to either split their offerings into multiple tokens—adding operational complexity—or abandon the tokenisation route altogether, thereby missing out on the efficiency gains that DLT promises. Similarly, the Börse Stuttgart, which has been a pioneer in Europe for digital asset trading, underscored that its tokenised bond platform has attracted institutional interest for tranches well above the €100 million mark. The exchange argued that a higher cap would not only align the regulatory framework with market demand but also enhance investor protection by bringing larger, more liquid tokenised assets under the oversight of a regulated exchange, rather than leaving them in a fragmented, less‑transparent environment.
The coalition also pointed to the broader strategic objectives of the European Union, noting that the EU has publicly committed to fostering innovation in financial services, supporting the development of a single digital market, and positioning Europe as a leader in sustainable finance. By maintaining an artificially low cap, the Commission risks sending a contradictory signal to innovators and investors, potentially driving capital and talent to jurisdictions with more accommodating regulatory regimes, such as the United States or certain Asian markets.
In response, the European Commission has indicated that it is reviewing the feedback from the pilot participants and will consider adjustments to the framework before the trial concludes in 2025. A spokesperson said that the Commission’s primary goal is to balance the need for innovation with the protection of investors and the stability of the financial system.
The regulator acknowledged that the pilot’s data collection phase has revealed a higher-than‑anticipated appetite for larger tokenised issuances, and that any amendment to the cap would be based on a thorough risk‑assessment process. Industry experts suggest that a flexible, tiered approach could be a viable compromise. Under such a model, smaller issuers could continue to operate under the €100 million limit, while larger projects could apply for a higher cap after demonstrating robust governance, adequate collateral, and transparent reporting mechanisms.
This would allow the EU to maintain oversight while accommodating the diverse needs of market participants. The coalition’s request also touches on the need for clearer guidance on secondary‑market trading of tokenised assets. Currently, the pilot permits limited secondary trading on approved platforms, but the low cap restricts the depth of liquidity that can be achieved.
By raising the cap, secondary markets could attract a broader pool of investors, improve price discovery, and enhance overall market efficiency. In summary, the joint letter from Nasdaq, the Börse Stuttgart, and a host of other stakeholders calls for a reassessment of the tokenisation cap that was initially set as a precautionary measure. The signatories argue that the cap is now out of step with the scale of ongoing projects, hampers innovation, and could undermine Europe’s strategic ambition to become a hub for digital finance. They propose either removing the ceiling entirely or raising it to a level—such as €500 million—that reflects the reality of current market activity while still allowing regulators to monitor systemic risk.
The outcome of this dialogue will likely shape the future regulatory landscape for tokenised securities in Europe and could have far‑reaching implications for the global adoption of blockchain‑based finance.