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EU Authority Aims to Centralize Crypto Oversight by Transitioning to ESMA

The European Commission has proposed a significant shift in cryptocurrency oversight within the EU.

This proposal aims to end the individual supervision of cryptocurrency companies by member states.

Instead, the responsibility would be transferred to the European Securities and Markets Authority (ESMA).

By consolidating oversight, the Commission seeks to address inconsistencies among the 27 member nations.

The move comes amid concerns that diverse regulatory approaches are undermining efforts for a unified crypto regulatory environment under MiCA.

The Commission emphasized that fragmented financial markets hinder competitiveness and efficiency gains across the EU.

Regulators from countries like France, Austria, and Italy have expressed their desire for tighter ESMA control over cryptocurrency regulations.

While ESMA currently fulfills a coordinating role, this transition could enhance its capabilities and functions, bringing it closer to a role similar to the U.S. SEC.

These proposals will require negotiation and approval from both the European Parliament and the European Council.

The potential for centralizing supervision marks a pivotal change in how the EU might shape its cryptocurrency landscape.