European Commission Set to Hand Full Crypto Oversight to ESMA

The European crypto world may soon look very different. A major change is quietly taking shape in Brussels. A new reform, now being drafted by the European Commission, aims to give ESMA (European Securities and Markets Authority) full control over licensing and monitoring crypto-asset service providers in all EU countries.

If approved, this would replace the current system, where each member state handles supervision individually.

EU Plans to Centralize Crypto Regulation

The European Commission is preparing a reform that would give the European Securities and Markets Authority (ESMA) full control over licensing and supervising all crypto-asset service providers across the EU.

Right now, crypto firms only need approval from one member state under the MiCA framework, and that license lets them operate across the entire bloc. This system took years for national regulators and companies to build and was expected to become fully stable by next year.

But the Commission is now considering a major shift: moving all authorisations and oversight to ESMA.

The idea is simple, crypto markets move fast, operate globally, and don’t fit neatly within national borders.

Critics Warn of Regulatory Disruption

Not everyone is welcoming the move. However, several other industry groups say shifting supervision in the middle of MiCA implementation could cause confusion.

Robert Kopitsch from Blockchain for Europe warned that reopening MiCA now risks slowing down the licensing process and creating uncertainty for businesses already preparing for full compliance next year.

He also stressed that national regulators have a closer relationship with companies, something a central authority may struggle to maintain.

Growing Push for a Centralized EU Market

This move isn’t just about crypto. Europe has been trying to centralize financial supervision for years from clearing houses to trading venues. France strongly supports this direction, while other countries fear losing control.

In fact, regulators in France, Italy, and Austria have already called for ESMA to directly oversee major crypto companies, leaving only smaller players under local regulators.

For now, the proposal still needs approval from the European Parliament and all EU member states. The draft will be released next month, and it is expected to spark one of the biggest regulatory debates the European crypto sector has seen.