EU Proposes Centralized Crypto Oversight Under ESMA, Mirroring SEC Model

The European Commission has unveiled plans to consolidate crypto market supervision under the European Securities and Markets Authority (ESMA), marking a significant shift from the current decentralized approach under MiCA. The proposal grants ESMA powers akin to the U.S. SEC, including direct authorization of cross-border crypto firms and oversight of major trading venues.

This MOVE aims to eliminate regulatory fragmentation across 27 member states while addressing competitive pressures from U.S. financial markets. The accelerated timeline—just nine months after being proposed in the Savings and Investments Union strategy—reflects growing political urgency for capital markets integration.

The framework introduces a unified licensing system, replacing the current passporting regime where companies secure jurisdiction-by-jurisdiction approvals. ESMA's expanded mandate now encompasses crypto asset service providers alongside traditional market infrastructure like central counterparties and securities depositories.