1. Short Description:
European firms urge EU to swiftly update tokenization rules or risk falling behind the US, where markets are scaling rapidly toward industrial-grade asset digitization.
2. Read Time:
4 minutes, 15 seconds
3. Main Article:
A coalition of European tokenization operators has issued a stark warning to EU policymakers, calling for urgent updates to the DLT Pilot Regime—the bloc’s regulatory sandbox for tokenized securities. Companies including Securitize, 21X, and Boerse Stuttgart Group argue that current restrictions, such as asset limits, volume caps, and six-year license durations, are stifling the growth of regulated onchain markets in Europe. In a joint letter, the group cautioned that without timely reform, “the EU risks losing market relevance” as global liquidity migrates to more advanced jurisdictions, notably the United States.
While praising the EU’s broader Market Integration and Supervision Package as a positive long-term vision, the firms emphasized that the United States is already moving decisively toward industrial-scale tokenization and near-instant settlement. They highlighted that U.S. regulators have provided clearer pathways, with the SEC issuing guidance on how broker-dealers can custody tokenized securities and granting approvals to entities like the Depository Trust & Clearing Corporation (DTCC) to launch tokenization services. Simultaneously, major exchanges such as Nasdaq and the New York Stock Exchange are developing platforms for trading tokenized stocks and ETFs, positioning the U.S. to capture a dominant share of the expanding real-world asset (RWA) tokenization market.
Rather than seeking broad deregulation, the European group proposes a targeted “quick fix” to the DLT Pilot Regime. This would involve expanding eligible assets, raising issuance caps, and removing the time limit on pilot licenses—all while preserving existing investor protections. They argue these technical adjustments can be implemented rapidly without reopening the EU’s wider market-structure reforms. The coalition warns that prolonged delay creates a “critical strategic vulnerability,” potentially undermining the euro’s competitiveness as settlement and issuance activity shifts toward faster, fully digital infrastructure.
4. Short Summary:
European tokenization firms are pushing the EU to urgently revise its DLT Pilot Regime, warning that current constraints hinder the scaling of regulated onchain markets. As the United States advances with clear regulatory guidance and exchange-led initiatives for asset tokenization, Europe risks ceding market relevance and global liquidity. Targeted updates to asset limits and license terms could help the bloc remain competitive in the rapidly evolving digital securities landscape.
