Verena Ross, chair of the European Securities and Markets Authority (ESMA), argues that Europe must enable tokenised markets to operate safely across borders at scale. Ross proposes a common EU framework, called DLT28, that could reduce fragmentation and support an integrated market for tokenised securities. Ross argues that investor protection and stronger cyber resilience remain essential to trust as tokenisation expands.
Ross describes tokenisation as increasingly mainstream, involving digital representations of shares, bonds and currencies that users can track and trade online. Ross argues that tokenisation could improve market efficiency, transparency, affordability and accessibility. European Central Bank analysis shows that the market capitalisation of tokenised assets on public blockchains rose from €7.4 billion at the start of 2024 to €38 billion in February 2026.
Ross notes that the United Kingdom has established a route from sandbox testing to live operations, potentially followed by a permanent regime if the Treasury adopts a statutory instrument. Ross notes that the US Securities and Exchange Commission has granted targeted regulatory relief that could allow on-chain securities trading through the innovation exemption. The EU's Distributed Ledger Technology (DLT) Pilot has let market participants and regulators test technology-based business models under controlled conditions since 2023. The DLT Pilot had authorised six DLT market infrastructures as of July 2026. Those infrastructures had collectively issued €546 million in tokenised assets. Ross argues that growing interest indicates the pilot remains useful for advancing wider adoption. However, Ross says limits on eligible assets and operational scale constrain participation. Ross says the European Commission's Market Integration and Supervision Package (MISP) initiative will address some restrictions on scale and scope, but further work remains necessary.
Ross identifies interoperability, secure on-chain cash settlement and legal certainty as the central requirements for wider adoption. Ross argues that scale requires connections among market DLTs, unrestricted liquidity flows and compatible standards. Ross says interoperability must connect different DLT systems and link digital infrastructure with traditional market infrastructure. Ross identifies safe, efficient tokenised money as the next priority. The European Central Bank launched the Pontes Initiative in September to connect DLT platforms with settlement using central bank money. ESMA supports several settlement options: central bank money, commercial bank deposits including tokenised deposits, and MiCA-regulated single-currency stablecoins known as e-money tokens. Ross says these options can meet different needs, with safeguards matched to the risks of each option.
Ross argues that investors need certainty about ownership, asset transfers and enforcement of investor rights. Ross says legal certainty must support moving some of the €80 trillion in existing securities onto DLT infrastructure. Ross says legal certainty must also support issuing new securities directly through DLT. Ross argues that Europe should permit both routes wherever issuers, market participants and investors identify benefits. Ross says MISP's proposed changes to the legal framework governing market infrastructure would provide part of the required EU-level certainty. However, Ross says national corporate and property laws still differ on eligible securities, responsibility for registers and requirements for parallel traditional records.
Ross warns that separate national approaches could reproduce the fragmentation of traditional EU financial markets and prevent an integrated tokenised market from achieving scale. Ross argues that an optional pan-EU regime could provide a consistent legal basis for issuing and transferring tokenised instruments throughout the European Single Market. Ross says supervision under that regime would need to encourage convergence rather than reproduce national divisions.
Ross argues that technology alone will not determine the future structure of Europe's capital markets. Ross says adoption will depend on business proposals and market demand, alongside policymakers removing obstacles and supporting interoperability and integration. Ross argues that the DLT Pilot remains useful for regulatory testing but cannot meet all of Europe's needs. Ross says public and private actors must jointly establish the foundations for an integrated tokenised market capable of operating at scale. Ross says ESMA is ready to contribute.