The European Commission is reportedly drawing up new rules that would give ESMA greater supervision of cryptocurrency companies, instead of leaving it to local regulators.
Summary
- It is said that they are EU legislators to draw up reforms to direct ESMA directly to crypto companies, which moves authority from national supervisors.
- The proposal has fueled the return of smaller EU states such as Malta and Luxembourg, who are afraid of losing regulatory autonomy and competitiveness.
According to a report from The Financial Times, EU legislers want to transfer crypto supervisors from national authorities to European effects and markets authority. This step falls under a proposal to give the EU market regulating authority directly supervision of trade fairs, crypto companies and clearinghouses.
Chairman of the ESMA, Verena Ross said That the European Commission is currently drawing up the reform of the regulations, which would serve to make legal supervision more uniform under the capital market in Europe. The EU had previously proposed ESMA to make the most important supervisor of Crypto companies when Mica was first prepared, but it was not fully implemented.
The plan to make ESMA the only supervisor for crypto in the EU has received a recoil from smaller countries with budding crypto agendas, such as Luxembourg and Malta. Malta in particular has actively granted licenses to providers of Crypto assets.
From July 2025, Malta has granted at least five CASP licenses in the context of the Mica Regulatory Framework, including licenses for large crypto fairs such as Crypto.com and OKX. These five licenses were one of the first in Europe that was granted under the new Mica framework, making Malta an important early adoptur of the extensive crypto-asset framework of the EU.
ESMA had in fact criticized the process of Malta’s license approval process for crypto companies. In July, the EU Financial Authority had claimed that “some risk areas were not sufficiently assessed during the authorization process” for an unnamed company that received a license from Malta’s authorities.
“It also means that people had to build up 27 times specific new resources and expertise in various national supervisors, who could have been done more efficiently at a European level,” Ross told Financial Times.
Why Esma at the helm is controversial
Founded in 2011, ESMA was formed in the hope of improving the harmonization of market rules throughout the EU. However, most of the financial market activities in the region still fall under the supervision of each of the 27 national authorities.
Ross said that the EU watchdog has been trying for some time with the Capital Markets Union and other initiatives to build a more effective capital market. ” Despite the efforts, such measures still have to implement to place all EU markets under one umbrella because each area has very different market structures.
Not everyone agrees that ESMA must have complete control over the different EU markets, especially in terms of his emerging cryptom markets. Some smaller EU countries, including Luxembourg, Malta and Ireland, have reduced against giving more authority to ESMA, with the argument that it could threaten their established financial sectors.
Not to mention the growing crypto industry, placing ESMA at the helm of regulating the regulation of crypto-acidroviders could create a rigid, one-size-fits-all system that suppresses innovation and concentrates too much power in a single authority.
On the way of the financial watchdog of the Luxembourg, committee -Surveion you have Sector financing Orzf, Claude Marx Hard warned That placing all EU investment funds under the supervision of ESMA would run the risk of creating a “sample” in what he regards an “extremely complex” organization.
“It is a fantasy that the European Commission wants to push a single supervisor. The European Commission has always stated that they do not have an idée -fixe to have a European SEC,” said Marx, referring to the American financial watchdog.
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