In recent weeks a broad coalition of market participants—including major exchanges such as Nasdaq and the Börse Stuttgart, a number of fintech firms, and several institutional investors—has formally appealed to European Union regulators to either remove the current ceiling on tokenised assets in the EU’s experimental tokenisation framework or, at the very least, raise it substantially. The coalition’s position stems from a growing body of evidence that the existing limit, which caps the total value of assets that can be tokenised under the pilot programme, is already being outstripped by several high‑profile projects that are operating within the European Union.
The tokenisation pilot, launched by the European Commission as part of its broader digital finance strategy, was intended to provide a controlled environment where issuers could experiment with the creation, distribution, and settlement of digital tokens representing real‑world assets such as equities, bonds, real estate, and commodities. The pilot’s original design set a maximum aggregate value—often referred to as the "cap"—that participants could tokenise without seeking a full regulatory licence.
While the cap was meant to mitigate systemic risk while the regulatory framework was still being refined, it quickly became apparent that the ceiling was too modest for the ambitions of many market actors. Nasdaq, one of the world’s leading exchange operators, highlighted that several of its European partners have already begun tokenising large‑cap securities that easily exceed the current threshold.
In a statement to the European Securities and Markets Authority (ESMA), Nasdaq argued that the cap hampers the ability of issuers to achieve meaningful scale, reduces liquidity benefits, and ultimately discourages innovation in a sector where the EU aims to be a global leader. The Börse Stuttgart echoed these concerns, noting that its pilot projects involving tokenised shares of German blue‑chip companies have already reached valuations well above the permitted limit, forcing participants to either truncate the offering or seek costly regulatory exemptions. Beyond the exchanges, a number of fintech firms that specialise in token creation and custodial services have joined the chorus. These companies contend that the cap creates a fragmented market where only small‑scale pilots can be conducted, preventing the development of robust secondary markets for tokenised assets.
They argue that a higher or removed cap would enable larger, more liquid pools of tokenised securities, which in turn would attract institutional investors seeking diversified exposure to digital assets. The coalition also points to the fact that other jurisdictions—most notably the United States, Singapore, and several Asian economies—have adopted more flexible approaches, allowing tokenised assets to scale without arbitrary ceilings. This, they claim, puts European innovators at a competitive disadvantage. The coalition’s appeal is not merely a plea for deregulation; it is accompanied by a set of concrete recommendations designed to preserve financial stability while fostering growth.
First, they propose a tiered cap system, where the ceiling would increase progressively based on the maturity of the tokenisation platform, the robustness of its risk‑management controls, and the quality of its custodial arrangements. Second, they suggest the introduction of a real‑time monitoring dashboard that would allow regulators to track the aggregate value of tokenised assets across the pilot, ensuring transparency without imposing a hard limit.
Third, they recommend that the EU adopt a “sandbox‑plus” approach, granting participants the ability to request temporary cap extensions on a case‑by‑case basis, subject to rigorous stress‑testing and reporting requirements. Regulators have responded with cautious optimism.
ESMA’s head of market infrastructure noted that the concerns raised by Nasdaq, Börse Stuttgart, and the fintech consortium are “well‑understood” and that the Commission is reviewing the pilot’s parameters as part of its ongoing Digital Finance Package. However, they also emphasised the need to balance innovation with investor protection, especially given the nascent nature of tokenised securities and the potential for market abuse. If the EU decides to raise or eliminate the cap, the implications could be far‑reaching.
A higher ceiling would likely accelerate the migration of traditional securities onto distributed ledger technology (DLT), reducing settlement times from days to minutes and cutting operational costs associated with clearing and custody. It would also enable the creation of fractional ownership structures, making high‑value assets such as commercial real estate or fine art more accessible to a broader investor base. Moreover, larger tokenised pools could attract cross‑border capital flows, enhancing the EU’s position as a hub for digital finance. Critics, however, warn that a sudden removal of the cap could expose the market to liquidity shocks if participants rush to tokenise large volumes without adequate risk controls.
They argue that any increase should be accompanied by strengthened supervisory tools, including enhanced AML/KYC procedures, rigorous audit trails, and clear guidelines on the legal enforceability of token‑based contracts. In summary, the coalition comprising Nasdaq, Börse Stuttgart, fintech innovators, and institutional investors is urging the European Union to reconsider the current tokenisation cap that limits the total value of assets that can be issued under the pilot programme. Their argument is grounded in real‑world evidence that the existing limit is already being exceeded by several high‑profile projects, and they propose a suite of measured reforms—tiered caps, real‑time monitoring, and a sandbox‑plus mechanism—to ensure that any relaxation of the rules does not compromise market stability. The outcome of this dialogue will shape the future of digital asset finance in Europe, determining whether the region can maintain its competitive edge in the rapidly evolving world of tokenised securities.