- French and Italian regulators propose changes to the DLT Pilot Regime to attract more participants in Europe‘s blockchain market infrastructure.
- Suggestions include increased proportionality based on project scale, extended duration, and expansion of supported assets beyond the current limitations.
- Only two projects have been approved under the current regime despite it being operational since April 2023.
French and Italian securities regulators have jointly proposed significant modifications to Europe’s Distributed Ledger Technology (DLT) Pilot Regime to increase participation. The AMF and CONSOB revealed their recommendations last week, addressing concerns about the program which, despite being operational since April 2023, has attracted only two approved projects so far – CSD Prague for settlement and 21X as a combined exchange and settlement platform.
The regulators’ proposals aim to make the European blockchain infrastructure program more competitive, especially when compared to alternatives like the UK’s Digital Securities Sandbox (DSS). Notable among the existing participants is 21X, which demonstrates several relaxed rules, including operating as a single entity managing both trading and post-trade infrastructure on a permissionless blockchain while using stablecoins for settlement.
Proportionality and Extended Timeline
A primary recommendation calls for “greater proportionality” based on project scale. Current activity limits are considered too restrictive by larger infrastructure providers, with one Deutsche Börse executive comparing it to “adapting an aircraft carrier to land a Cessna, but only for one or two landings.” The regulators suggest that the European Securities and Markets Authority (ESMA) should have flexibility to adjust these limits.
The short-term nature of the program has also deterred participation. To address this, AMF and CONSOB recommend extending the DLT Pilot Regime’s duration and providing clarity about the exit process for participants.
Expanding Asset Types and Settlement Options
The regulators advocate for broader authorization of electronic money tokens (EMTs) and tokenized deposits as settlement assets. They also expressed support for developing a central bank money settlement solution, which the European Central Bank has already announced. Additionally, they propose expanding the range of supported assets to include structured bonds and certain derivatives.
Further recommendations include developing common EU standards for interoperability with legacy systems and promoting DLT benefits to both issuers and investors. Some of these suggestions echo previous AMF recommendations regarding tokenization and Central Securities Depositories (CSDs).
Marie-Anne Barbat-Layani, AMF Chair, and Paolo Savona, CONSOB Chair, emphasized the importance of these changes in a joint statement: “At a time when Europe wishes to develop its financial markets to meet its financing needs with the Savings and Investment Union, it is clearly a priority that Europe puts in place a competitive framework to encourage innovation, and market testing of distributed ledger technology, in order to better measure the potential benefits.”
✅ Follow BITNEWSBOT on Telegram, Facebook, LinkedIn, X.com, and Google News for instant updates.
Previous Articles:
- Bitcoin Hits $85K as Trump Tariff Pause Fuels Crypto Market Surge
- MicroStrategy Dilutes Shareholders, Buys Bitcoin at Premium Prices
- XRP Funds See Rare Inflows as Bitcoin ETFs Face $751M Exodus
- Google and Apple Face Challenges as Bitcoin Threatens App Store Control
- Laser Digital denies involvement in 90% Mantra token flash crash
