EUROPEAN AUTHORITIES' CONTROL OVER CRYPTO SECTOR

According to ESMA’s chair, the plan to consolidate crypto regulation under one authority will help integrate Europe’s financial markets and attract more global investment. The goal is to make supervision simpler, faster, and more transparent.

The European Union is preparing a major shift in financial oversight that would place cryptocurrency platforms, stock exchanges, and clearing houses directly under the control of its central markets regulator—the European Securities and Markets Authority (ESMA).

ESMA chair Verena Ross said the European Commission is developing plans to move several key areas of financial regulation from national agencies to ESMA. The goal is to create a more unified and transparent system across the bloc’s 27 member states, reducing overlaps and boosting investor confidence.

If implemented, this change would mark a big step toward centralized EU-wide supervision of digital assets and traditional markets alike, aligning with Brussels’ broader push to strengthen and integrate European capital markets.

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EU PUSHES FOR CENTRALIZED SUPERVISION OF CRYPTO AND CAPITAL MARKETS

The European Union is preparing to hand more regulatory power to the European Securities and Markets Authority (ESMA) as part of a major effort to build a stronger and more unified financial system across the bloc.

According to ESMA chair Verena Ross, the proposal would bring cryptocurrency platforms, stock exchanges, and clearing houses under direct EU supervision—a move she says will help create “a more integrated and globally competitive capital market” in Europe.

The plan aims to replace fragmented oversight currently handled by 27 national regulators with a single EU-level system, reducing red tape and improving investor protection. However, the proposal faces resistance from smaller countries such as Luxembourg and Malta, which fear losing regulatory influence over their financial sectors.

This latest step builds on the Markets in Crypto-Assets (MiCA) regulation, which took effect earlier this year and established the EU’s first comprehensive framework for digital assets. Expanding ESMA’s powers would mark the next stage in Europe’s effort to modernize financial oversight and position itself as a global leader in crypto regulation.

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The European Securities and Markets Authority (ESMA) says fragmented supervision across 27 EU countries has slowed progress toward a unified capital market.

ESMA chair Verena Ross noted that leaving crypto regulation to national watchdogs has created inefficiencies and duplication of effort. Each country had to build its own teams and expertise instead of relying on a single EU-level body.

In July, ESMA publicly criticized Malta’s licensing process for crypto firms, warning that risk assessments were not properly handled in one case.

Ross added that while ESMA and national regulators are working hard to align the new Markets in Crypto-Assets (MiCA) rules, centralizing oversight could make the process faster and more consistent across Europe.

Established in 2011, ESMA was designed to harmonize EU financial regulations, but much of the supervision remains with individual member states—something the agency hopes to change under the new proposal.

EU CONSIDERS EXPANDING ESMA’S POWERS TO BOOST CAPITAL MARKETS

Former European Central Bank president Mario Draghi has called the transformation of the European Securities and Markets Authority (ESMA) into a single regulator—similar to the U.S. SEC—a key step toward strengthening Europe’s capital markets.

However, several smaller EU nations, such as Luxembourg, Malta, and Ireland, oppose the plan, fearing that centralizing authority in Paris could weaken their local financial industries. Luxembourg’s top regulator even warned that giving ESMA full control could create a “monster.”

Despite this resistance, ESMA Chair Verena Ross says that Europe’s urgent need for private investment in defense, green energy, and digital projects is driving momentum for reform. She noted that breaking down long-standing market barriers is now a priority at both the EU and national levels.

ESMA has already gained more responsibilities, including oversight of market data providers and ESG rating agencies, starting next year. Meanwhile, EU Commissioner Maria Luís Albuquerque confirmed that Brussels is studying a proposal to give ESMA supervisory power over major cross-border entities—including stock exchanges, crypto firms, and central clearinghouses.

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If adopted, the changes could reshape how Europe manages its financial markets, moving toward a single, more powerful regulatory body.