EU Tokenization Rules Face Pushback: Fintechs Want Bigger DLT Pilot

Alejandro Martínez · 2026-09-11

France FinTech just teamed up with a coalition of traditional finance players and tokenization advocates. Their message to European lawmakers? The current DLT Pilot Regime revision doesn't go far enough. ### What's Actually Happening The European Commission proposed raising the cap on financial instruments traded on DLT infrastructure from €6 billion to €100 billion (roughly $6.5 billion to $108 billion). Sounds impressive, right? The coalition says it's still nowhere near what's needed. Here's the thing: global capital markets are massive. Tokenization is accelerating worldwide. And Europe risks getting left behind if its infrastructure can't scale to meet real market demand. ### What the Coalition Wants The group laid out three core recommendations for EU co-legislators as part of the Market Integration and Supervision Package (MISP): - **Remove the cap entirely** – or at least set it high enough that European DLT infrastructure can actually reach meaningful market size - **Build in flexibility** – give the European Commission a mechanism to adjust thresholds as the market evolves, so we're not stuck with outdated limits - **Keep it fair** – no tiered thresholds that accidentally favor one business model over another The goal isn't complicated: create a European framework that supports tokenized financial markets for the long haul and keeps them competitive globally. ### Why This Matters Beyond Europe If you're watching tokenization trends from the US, this debate should sound familiar. It's the same tension playing out everywhere: regulators want guardrails, innovators want room to build. > "The question isn't whether tokenized markets will grow. It's whether Europe will have infrastructure ready when they do." A cap that's too low doesn't just slow things down. It pushes activity to other jurisdictions. That means less liquidity, fewer jobs, and diminished influence over global standards. ### The Bigger Picture The coalition includes both traditional finance institutions and crypto-native firms. That's notable. When banks and blockchain startups agree on something, regulators tend to listen. Their argument boils down to this: Europe has ambitious goals for digital finance. But ambition without adequate infrastructure is just talk. The DLT Pilot Regime was supposed to be a testing ground. Now it needs to become a launchpad. ### What Happens Next The MISP package is still working through the EU legislative process. Co-legislators – the European Parliament and Council – will have their say. The coalition is pushing for amendments that reflect their recommendations. For US-based fintech professionals and payment system watchers, this is worth tracking. Europe's approach to tokenization could influence how other regions regulate – or deregulate – their own markets. And in a global financial system, what happens in Brussels rarely stays in Brussels.