The European Securities and Markets Authority (ESMA) will take over the reins as supervisor of European Union (EU) stock exchanges, cryptocurrency companies and clearing houses.
According to Verena Ross, Chair of ESMA, the European Commission (EC) is drawing up plans to enable ESMA oversight of how EU countries’ financial markets operate away from independent oversight of national authorities.
This will include oversight over all EU countries to provide a standard and holistic approach to ensure a fair single capital market for Europe, with a view to mitigate the “fragmentation in markets”, said Ross.
ESMA was established in 2011 to provide harmonisation across the 27 EU bloc nations of its regulations and financial market activities. The Authority initially held oversight over the EU’s enforcement of the Markets in Crypto Assets (MiCA) rules, but was criticised for its handling of the licensing process for incumbent companies.
“We have tried for quite some time with the capital markets union and other initiatives to build a more effective capital market,” said Ross. “The reality has been that it is not easy to do given we have very different market structures.”
Friction within MiCA alignment
The Financial Times reported some of ESMA’s proposed solutions to bring forth a single capital market may draw criticism from smaller EU nations such as Luxembourg and Malta.
Both countries have operated via their national authorities when it pertains to issuing operating licences, including those under the guidance of MiCA. A flurry of crypto exchanges, such as Crypto.com, OKX, Gemini and Bitpanda, have obtained their MiCA licence via the Malta Financial Services Authority (MFSA).
While Malta has become a favourite destination for many Crypto Asset Service Providers (CASP) to launch European operations from, its approach to issuing licences has come under scrutiny from ESMA.
The Authority criticised MFSA’s authorisation process in June 2025 and cited concerns over the national regulator’s risk level approach when investigating incumbent CASPs. ESMA also highlighted the quicker licensing process in relation to other EU national regulators.
This list of concerns was filed into a review of MiCA’s initial performance since launching in July 2024.
“The overall authorisation process should have been more thorough and conducted on a sufficient time to allow MFSA to properly assess compliance against the MiCA framework,” said ESMA in the review.
Focus on financial investment
ESMA’s new oversight of MiCA’s rules is intended to create a more standardised, central approach for the licensing process across all 27 EU countries.
“While we are doing a lot of work to try to make sure the implementation of MiCA is aligned, it clearly takes a lot of effort from us and the national supervisors to achieve that,” said Ross.
With Ross also in charge of finding new private capital investment for its relevant financial markets, such as crypto, she emphasised the need to support Europe’s financial market to compete against the likes of the US and China should not just be at the “EU level, but also at member states’” levels too.
