Good morning, community! This news is crucial for any crypto project operating in Europe.
The European Commission proposed to drastically expand the authority of the European Securities and Markets Authority (ESMA).
New Power: ESMA would have direct supervisory control and the licensing of key infrastructure, including Crypto Asset Service Providers (CASPs), trading venues, and central counterparties.
The Objective: Align EU supervision with more centralized models, such as that of the SEC in the U.S..
⚠️ The Friction
This proposal, while seeking uniformity, raises serious concerns about excessive centralization.
Danger to Startups: Experts fear that ESMA's dual role in authorization and supervision could lead to delays or overly cautious assessments, hindering the growth of innovative startups in Europe.
Operational Risk: Without sufficient resources, ESMA's mandate could become "ungovernable", disproportionately affecting small and disruptive companies.
🌍 The Global Context
The package aims to make the EU capital markets ($11 trillion in value) more competitive against the giant US stock market ($62 trillion). But effectiveness will depend on ESMA's capability.
Do you think regulatory centralization under ESMA is necessary for investor protection and competitiveness, or do you believe it hinders DeFi and Fintech innovation in Europe?
Comment and share your perspective on the EU's regulatory future! 👇
Information Taken from: Binance Square
