Europe Needs One Rulebook for Tokenised Markets
Europe's securities markets hold some €80 trillion of existing securities, yet the records of who owns them are spread across more than thirty central securities depositories and twenty-seven separate bodies of national law, whereas the United States manages with two depositories. Tokenisation, which records ownership on a shared digital ledger and allows payment and delivery to happen instantly, offers a rare chance to replace this patchwork with one connected market. On 23 October 2026, in a guest column for Reuters Breakingviews, the outgoing Chair of the European Securities and Markets Authority (ESMA), Verena Ross, called for an optional pan-European legal regime for tokenised instruments, which she named DLT28.
The proposal deserves strong support, because without a common legal base the technology is likely to inherit the very divisions that it was meant to remove. It should, however, be treated as a stepping stone and not as a finished answer, since a single framework drafted in haste could move fragmentation from the law into the technology, or could weaken the protections that investors rightly expect. The case for the proposal, the reasons for care in its design, and the steps that the European Union should take next are set out below.
The first reason to welcome DLT28 is the modest record of the present approach. The DLT Pilot Regime, in force since 2023, had authorised only six market infrastructures by July 2026, and together they had issued about €546 million in tokenised assets, even as the value of tokenised assets on public blockchains rose from €7.4 billion in early 2024 to €38 billion by February 2026, according to European Central Bank data. Demand clearly exists, but it is not flowing into the European framework.
The second reason is that the reforms now under negotiation address size more than substance. The Market Integration and Supervision Package, proposed by the European Commission in December 2025, would lift the ceiling for each DLT market infrastructure from €6 billion to €100 billion, and the Council agreed in October 2026 to raise it further to €300 billion. A larger ceiling, however, does not change the fact that national corporate and property laws still differ on which securities may be tokenised, on who is responsible for the register, and on whether a traditional record must be kept alongside the digital one. Only an EU-level legal basis can give an investor full certainty that a token bought from a seller in another Member State carries complete legal ownership.
The third reason is both competitive and institutional. The United Kingdom has opened a route from sandbox testing to live operation, and the United States Securities and Exchange Commission has granted targeted relief that could allow securities to trade on chain. ECB President Christine Lagarde warned in June 2026 that national regimes for digital assets are already multiplying, and ESMA's Board of Supervisors noted in July 2026 the dangers of national legal constraints, fragmentation and duplication. An optional "28th regime", an idea long debated at the European Capital Markets Institute, allows willing issuers to move ahead without forcing every Member State to rewrite its civil law.
A common framework nonetheless requires careful design, for three reasons. First, an optional regime could divide liquidity among DLT28 instruments, national tokens and traditional securities if reliable links between them are missing. Lagarde opposed the Council's higher ceiling on precisely this ground, cautioning that DLT structures may not be interoperable, and ECB Executive Board member Piero Cipollone warned in August 2026 that a spread of incompatible platforms could deepen the fragmentation of today's markets.
Second, legal detail matters most in a crisis. ESMA's October 2026 call for evidence on tokenised collateral in central clearing asks whether control of a digital wallet or private key satisfies the possession or control test of the Financial Collateral Directive, and how technical finality on a ledger relates to legal finality under the Settlement Finality Directive. A DLT28 that leaves such questions open, or that is unclear on what happens to tokenised assets when an operator fails, would offer certainty only in calm conditions.
Third, supervision and settlement money must be consistent. Ross herself stressed that supervision under a pan-European regime must encourage convergence and not reproduce national divisions, and that investor protection and cyber resilience remain essential to trust. A regime overseen through twenty-seven national approaches, or settled largely in foreign-currency stablecoins, would undermine the very integration it is meant to achieve.
DLT28 is therefore the right idea at the right time, and it should be taken up as the next step once the Market Integration and Supervision Package is agreed. To serve as a sound stepping stone, the Commission should propose a directly applicable regulation that sets clear rules on ownership, transfer, registers and treatment in insolvency. Access to the regime should depend on meeting common interoperability standards and on settlement in central bank money through the ECB's Pontes initiative, or in regulated tokenised deposits and e-money tokens. ESMA should be given a clear role in ensuring convergent supervision and strong investor protection, and the regime should carry a firm review clause that tests whether liquidity is being united or divided. Europe's tokenised market is still small enough to be designed well from the outset, and if lawmakers combine ambition with care, DLT28 could give the €80 trillion now scattered across national systems a single and secure legal home.
Sources
Ross, Verena. "Guest View: EU Tokenisation Drive Depends on Scale." Reuters Breakingviews, October 23, 2026. https://www.breakingviews.com/columns/considered-view/guest-view-eu-tokenisation-drive-depends-scale-2026-10-23/
"EU Tokenisation Needs Scale and Common Legal Framework, Says ESMA Chair." KuCoin News (via NS3), October 23, 2026. https://www.kucoin.com/news/flash/eu-tokenisation-needs-scale-and-common-legal-framework-says-esma-chair
Ledger Insights. "EU Finance Ministers Want DLT Pilot Regime Cap Raised to €300bn. Lagarde Objects." Ledger Insights, October 12, 2026. https://www.ledgerinsights.com/eu-finance-ministers-wants-dlt-pilot-regime-cap-raised-to-e300bn-lagarde-objects/
Lagarde, Christine. "Opening Speech at the ECB Conference 'Money in Transition: Digitalisation and Innovation in Payments.'" Frankfurt am Main, June 15, 2026. Reproduced in BIS Central Bankers' Speeches. https://www.bis.org/review/r260622g.pdf
Cipollone, Piero. "From Vision to Delivery: Building Europe's Tokenised Financial Market." Speech at the Deutsche Bundesbank Symposium, Frankfurt am Main, August 26, 2026. https://www.bis.org/speeches/20260915-vision-delivery-building-europes-tokenised-financial-market.pdf
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