The European Central Bank has backed the European Commission’s proposal to place supervision of major crypto firms under the EU’s financial markets regulator.
In an opinion published on Friday, the ECB said it fully supports moving oversight of systemically important cross-border capital market firms, including large trading platforms and crypto companies, to the European Securities and Markets Authority (ESMA). The bank called the proposals “an ambitious step towards deeper integration of capital markets and financial market supervision within the Union.”
The opinion is nonbinding but is expected to give the plan significant momentum. It would represent the most substantial change to EU crypto regulation since the Markets in Crypto-Assets (MiCA) framework began coming into force in mid-2023.
Under MiCA, crypto-asset service providers (CASPs) can operate across the EU under the supervision of a member state’s regulator, with ESMA issuing some standards and guidance. That approach has allowed firms to choose favorable licensing jurisdictions—Kraken set up its EU arm in Ireland; Coinbase and Bitstamp in Luxembourg; Bitpanda in Austria, while its EU asset management arm chose Germany.
Some countries, including Malta—a popular MiCA licensing hub—have pushed back against centralising oversight, arguing the move is premature because MiCA rules for CASPs only came into force in December 2024.
The ECB said transferring authorisation, monitoring and enforcement powers for all CASPs from national regulators to ESMA would promote supervisory convergence, reduce fragmentation and mitigate cross-border risks in crypto markets, supporting financial stability and the integrity of the single market.
It noted that banks are increasingly connected to crypto firms—by offering crypto services to customers or by providing banking services to crypto companies—which could transmit shocks from the crypto sector into the wider financial system. That, the ECB argued, reinforces the need for a centralised Union supervisory regime for CASPs with significant activities to address systemic risks, prevent risk migration into the banking system and safeguard financial stability.
The ECB added that ESMA would require adequate funding and staffing to take on direct supervision of crypto companies. The proposal is likely months from becoming law, with EU governments and lawmakers set to negotiate it before the European Parliament moves forward.
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