ESMA to Gain SEC-Style Oversight for Crypto and Stocks

Key Takeaways
• The European Commission is preparing a proposal to expand ESMA’s authority and centralize supervision of stock and crypto exchanges across the EU.
• The plan aims to make EU capital markets more competitive and cohesive, reducing regulatory fragmentation.
• ECB President Christine Lagarde supports creating a “European SEC” to oversee large cross-border firms.
• France, Austria, and Italy have pushed for ESMA to directly supervise major crypto companies under MiCA.

EU Plans Unified Oversight for Stock and Crypto Markets

The European Commission is considering regulatory reforms to bring both stock and cryptocurrency exchanges under centralized supervision, adopting a model similar to the US Securities and Exchange Commission (SEC).

According to the Financial Times, the proposal would expand the authority of the European Securities and Markets Authority (ESMA) to directly oversee trading platforms, crypto asset service providers, and other financial infrastructure.

At present, the EU relies on multiple national regulators, creating complexity and higher costs for startups operating across borders. The reform, part of the Capital Markets Union initiative, seeks to simplify oversight, improve liquidity, and help startups raise capital more easily.

European Central Bank President Christine Lagarde has expressed support for the concept, noting that a “European SEC” could mitigate systemic risks and strengthen investor protection. “Creating a European SEC, for example, by extending the powers of ESMA, could be the answer,” Lagarde said at the European Banking Congress.

The European Commission is expected to publish a draft of the proposal in December. It would grant ESMA the authority to issue binding decisions in cross-border disputes and play a greater role in supervising asset managers.

France Pushes for ESMA Control Amid MiCA Concerns

The proposal comes as France and other EU members raise concerns over uneven enforcement of the Markets in Crypto-Assets Regulation (MiCA). Under MiCA, crypto firms licensed in one member state can operate throughout the EU via “passporting,” but regulators fear inconsistent national standards could undermine investor confidence.

France’s securities regulator has warned it may restrict passporting rights, citing fears that some jurisdictions apply lighter oversight. The country, along with Austria and Italy, has urged ESMA to take full supervisory control of large crypto companies to ensure fair and consistent regulation.

ESMA Chair Verena Ross confirmed that the commission is planning to shift more oversight responsibilities from national authorities to ESMA. She emphasized that the move is designed to reduce “continued fragmentation in markets” and advance Europe toward a unified capital market.

If approved, the initiative would mark one of the most significant steps toward a single European financial regulator, giving ESMA broader powers over both traditional and digital assets and making the EU’s financial sector more globally competitive.