Concerns Rise Over Centralized Crypto Licensing in the EU
- The European Commission proposed to grant the European Securities and Markets Authority (ESMA) direct supervisory powers over crypto-asset service providers (CASPs).
- This proposal aims to unify national licensing regimes, but may slow down the licensing process for startups, according to industry experts.
- Faustine Fleuret from Morpho expressed concerns that ESMA would handle both authorization and supervision of CASPs, potentially hindering innovation.
- The proposal is still under negotiation and requires approval from the European Parliament and Council.
- Currently, the US stock market is valued at approximately $62 trillion, while the EU’s market value stands at around $11 trillion.
The proposed centralization of crypto regulation under ESMA seeks to address inconsistencies in national practices but raises concerns about potential delays in licensing for smaller firms. Experts warn that without adequate resources, this could lead to overly cautious assessments affecting innovation.
If adopted, this reform could reshape the regulatory landscape for crypto in Europe, mirroring aspects of the US model with significant implications for startup development and competition in capital markets.(Source)
