The European Commission is preparing to create a single supervisory authority for European financial and crypto markets.
Date: 2025-11-03 Author: Gabriel Deangelo Categories: IN WORLD
The European Commission is preparing to present a reform package called "market integration" in December 2025, aimed at creating a centralized financial regulator for the entire European Union. According to the Financial Times, the new structure will be based on the model of the US Securities and Exchange Commission (SEC) and will combine oversight of traditional and digital assets.
Brussels believes that the current system, consisting of multiple national authorities and independent trading platforms, hinders the effective functioning of cross-border transactions and limits the growth opportunities of tech companies and startups. The idea of unified oversight was previously supported by ECB President Christine Lagarde and former Italian Prime Minister Mario Draghi, who in his report urged the completion of the "capital markets union" project.
The new initiative proposes transferring significant powers to the European Securities and Markets Authority (ESMA). The organization will oversee the activities of stock and crypto exchanges, clearing houses, and depository systems. This will eliminate fragmentation in the financial sector and improve the EU's competitiveness against the United States.
According to preliminary proposals, ESMA will be given oversight over stock exchanges, crypto services, central counterparties (CCPs), and securities depositories (CSDs). The authority will also be able to resolve conflicts between national regulators and large asset management companies.
European Commission representatives noted that they are exploring various regulatory options, seeking to find a balance between the common interests of the European Union and the expertise of national institutions. However, this unified approach is controversial: Luxembourg and Ireland oppose centralization, fearing that transferring powers to ESMA will undermine the position of their financial centers.
Luxembourg Finance Minister Gilles Roth stated that his country supports the unification of supervisory standards, but not the creation of a costly central bureaucracy. Representatives of European exchanges have expressed similar concerns, warning that expanding ESMA's powers will lead to increased administrative costs and fees for the industry.
Nevertheless, Germany and France are demonstrating a willingness to compromise. According to the FT, Berlin, which previously opposed centralization, is now willing to consider transferring some functions to ESMA, including oversight of asset management, although it does not yet agree with the idea of directly overseeing crypto exchanges.
Earlier, ESMA head Natacha Cazenave warned that the increasing interdependence of the crypto market with traditional finance increases risks to financial stability. Meanwhile, the Banque de France called for the transfer of oversight of large crypto companies to a single European supervisory authority in order to establish uniform regulatory standards across all EU countries.
