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The European Securities and Market Authority (ESMA) published some of the final rules relating to the Markets in Crypto-Assets Regulation (MiCA) crypto asset regulations. These include the information required for licensing crypto-asset service providers (CASPs) and how regulated institutions provide notification that they plan to offer CASP services. Separately, ESMA published a consultation on a third package of rules covering topics such as detecting market abuse and client rights. https://www.esma.europa.eu/press-news/esma-news/esma-launches-third-consultation-under-mica https://www.esma.europa.eu/press-news/esma-news/esma-finalises-first-rules-crypto-asset-service-providers

The European Securities and Markets Authority (ESMA) published its Report on the distributed ledger technology (DLT) pilot regime. It provides guidance on certain technical elements and makes recommendations on compensatory measures on supervisory data to ensure a consistent application by DLT market infrastructures from the start of the regime. The report presents ESMA's proposed way forward and concludes that there is no need to amend the regulatory technical standards (RTSs) on transparency and data reporting requirements before the DLT pilot starts applying in March 2023.

The European Securities and Markets Authority (ESMA) recognized that the three central counterparties (CCPs) established in the United Kingdom - ICE Clear Europe Limited, LCH Limited, and LME Clear Limited - will be recognised as third country CCPs (TC-CCPs) eligible to provide their services in the EU, after the end of the transition period following the withdrawal of the UK from the EU on 31 December 2020.

The European Securities and Markets Authority (ESMA) is asking for input from stakeholders on the use of distributed ledger technology (DLT) for trading and settlement of tokenized securities. ESMA is assessing whether the regulatory technical standards developed under the Markets in Financial Instruments Regulation (MiFIR) relative to certain trade transparency and data reporting requirements need to be amended.

The European Securities and Markets Authority (ESMA) published two articles on decentralized finance (DeFi), one on developments and risks in the European Union (EU) market and another on a methodology for the categorization of smart contracts. The article on DeFi warns of serious risks to investor protection, because of the highly speculative nature of many arrangements and important operational and security vulnerabilities. DeFi's unique features have led to new market manipulation issues that need to be addressed.

ESMA has concluded that, based on the evidence gathered, that at present most innovative business models can operate within the existing EU rules,

"The high level of market concentration typically observed in BigTech may get carried into financial services, with potentially adverse impacts on consumer prices and financial stability," the European Securities and Markets Authority, or ESMA, said of Big Tech companies entering finance, as part of its 2020 Trends, Risks and Vulnerabilities report.

The European Securities and Markets Authority (ESMA) launched a consultation on draft technical standards on crowdfunding under the European crowdfunding service providers regulation (ECSPR). The new Regulation on crowdfunding regulates for the first time at the EU level lending-based and equity-based crowdfunding services. It introduces a single set of requirements applicable to crowdfunding service providers (CSPs) across the EU, including strict rules to protect investors.

The European Securities and Markets Authority (ESMA) published its analysis of crypto-assets' risks and transmission channels to financial markets. It finds that crypto-asset markets are still small in size and their interlinkages to traditional markets are limited, but this situation may change as market growth can occur suddenly and risk transmission is possible through various channels. It recommends continuous monitoring of the crypto-asset market and its interconnectedness with the wider financial system to assess newly emerging threats in a timely manner.

The European Securities and Markets Authority (ESMA) says there is no need for new regulatory technical standards before the start of the European Union's distributed ledger technology (DLT) pilot regime in March 2023. The regime aims to reduce the regulatory burden to enable blockchain-based securities trading and settlement to be trialed at scale and provide legal certainty. Tokenized stocks, bonds and investment funds fall within the DLT Pilot regime and have monetary limits.

The European Banking Association and the European Securities and Markets Authority have written to the European Commission to say they will review the legal frameworks used by European Union member states for monitoring stablecoins such as Libra.

The European Securities and Markets Authority (ESMA) published an analysis of crypto-asset market structures, secondary trading and their relevance for the European Union. It finds that crypto-asset market capitalizations and trading volumes are significantly concentrated in a few assets, with a high reliance on the US dollar and the South Korean won as market on- and off-ramps. Only around 20% to 30% of transactions involve fiat currencies and most transactions occur within the system itself. Also, trading volumes are highly concentrated in a few crypto exchanges, with the largest exchange (Binance) accounting for almost half of global trading volumes.

According to Jan Krahnen and Katja Langenbucher the Wirecard scandal is a wake-up call alerting German politics to the importance of securities market integrity. A fundamental overhaul of the European fragmented securities markets supervisory regime offers the potential to lead to the establishment of an independent European Single Market Supervisor (ESMS). Endowed with strong enforcement powers, and supported by the existing national agencies, the ESMS would be entrusted with ensuring a uniform market standard as to transparency and other issues of market integrity across Europe. This would not rule out maintaining a variety of market organization structures at the national level. The ESMS would need executive powers in the world of markets (i.e. securities and trading), much like the ECB Single Supervisory Mechanism (SSM). To fill this new role, ESMS would have to be established as a new, independent institution, including an enormously scaled up staff compared to the European Securities and Markets Authority (ESMA).

"The three European Supervisory Authorities (EBA, EIOPA and ESMA) published today a joint report in response to the European Commission's February 2021 Call for Advice on Digital Finance. The proposals that were put forward aim at maintaining a high level of consumer protection and addressing risks arising from the transformation of value chains, platformisation and the emergence of new 'mixed-activity groups' i.e. groups combining financial and non-financial activities."

LCH SA has received the required regulatory approval from the French national competent authorities (ACPR, Banque de France and AMF) and European supervisory authorities (EMIR College, ESMA) to clear cash-settled Bitcoin index futures and options contracts. LCH SA will provide clearing services through its new dedicated service, LCH DigitalAssetClear, for these contracts traded on the UK FCA regulated digital asset derivatives trading venue, GFO-X. LCH DigitalAssetClear is underpinned by a segregated default fund, tailored risk management model and dedicated set of clearing rules. LCH SA plans to launch the clearing service later in 2024.