A coalition of European financial firms led by Nasdaq, Boerse Stuttgart Group and Securitize has formally asked EU lawmakers to remove a proposed 100 billion euro ceiling on tokenized securities, arguing the limit would make projects already in operation non-compliant before the rules even take effect. The letter, dated September 7 and addressed to EU Council members and the European Parliament’s Economic and Monetary Affairs Committee, sets a minimum ask of 500 billion euros and calls 1.5 trillion the appropriate long-run baseline.
The fight concerns the EU’s DLT Pilot Regime, in force since March 2023. The regime lets authorized firms operate blockchain-based trading and settlement systems for securities under targeted exemptions from standard market rules. Its purpose was always experimental: test distributed infrastructure in live markets without rewriting the entire legislative book first. Three years in, the industry says the experiment worked and the walls are now the problem.
Why the cap is the problem
The European Commission’s Market Integration and Supervision Package, the legislative vehicle now under negotiation, proposes raising the per-infrastructure limit from 6 billion to 100 billion euros. The coalition says that is not nearly enough, and its reasoning is specific. The thresholds apply to the market value of instruments admitted to a DLT infrastructure, not to trading volumes. An admitted-value cap is comparable to the total market capitalization a platform can host, which is a far tighter constraint than a volume ceiling would be.
The letter’s sharpest claim is that certain European DLT projects currently operate at or near 350 billion euros in admitted-asset value and plan further expansion. If that figure is accurate, a 100 billion euro cap would not merely constrain growth. It would render existing projects non-compliant under revised rules before the revision passes into law.
Who signed, and why it matters
The signatories span traditional exchange operators, digital-asset trading venues and tokenization technology providers: Nasdaq, Boerse Stuttgart Group, Securitize, the European Ethereum Institute and Axiology, among others. That breadth is the point. The scaling complaint is not coming only from crypto-native firms. Mainstream market infrastructure operators have signed the same letter, which gives the argument weight in negotiations where crypto lobbying alone tends to travel poorly.
The competitive framing is explicit. If European platforms operate under a 100 billion euro ceiling while US counterparts face no equivalent restriction, European infrastructure carries a structural disadvantage that could push liquidity across the Atlantic. A similar coalition including Securitize, 21X and Boerse Stuttgart warned in February that restrictive caps and time-limited DLT licenses were already preventing regulated on-chain markets from scaling in Europe. In April, a group of 39 firms and industry bodies including Nasdaq and Boerse Stuttgart called for a limit between 100 and 150 billion euros, broader asset eligibility and the removal of time limits on DLT licenses. The September letter goes further than any of them.
The escalation pattern tells its own story. Each successive letter has raised the number and widened the coalition, and the shift from asking for adjustment to asking for outright removal signals that the industry has given up on incremental reform. Whether that reads as confidence or frustration depends on which side of the negotiating table one sits.
The regulatory mechanics
The cap is not an abstract number. If a DLT platform exceeds its admitted-value limit, its Pilot Regime authorization could be affected, which changes the regulatory and liquidity status of every instrument hosted on it. That cascades into fair value measurement under IFRS 13 and disclosure obligations under IFRS 7. Finance teams holding tokenized instruments would need to model each scenario: cap unchanged, cap raised, cap removed. Accounting firms have started advising clients to map their exposure now, identify which platforms host their tokenized instruments and track admitted-value figures against both the current and proposed limits as a live compliance metric.
Law firms and industry groups have made the same point in less technical language. Tokenized securities cannot scale to institutional size if the legal container around them has a hard ceiling. The regime was designed as a sandbox, and the industry is arguing the sandbox walls are now the product.
Where negotiations stand
The Market Integration and Supervision Package is active in the EU legislative process, with the Commission, Council and Parliament negotiating the final text. No date for agreement has been confirmed. The September letter’s detailed numerical asks suggest the coalition expects a negotiated outcome rather than a binary accept-or-reject of the Commission’s proposal.
What happens next will shape how much of Europe’s bond and equity market can legally sit on blockchain rails. The EU has staked credibility on being the first major jurisdiction with a working framework for tokenized securities, and the UK and US are both moving on their own versions of digital asset market rules. India has already launched a pilot tokenizing its 620 billion dollar corporate bond market with digital rupee settlement. If the cap survives in anything close to the Commission’s proposed form, the industry’s warning is straightforward: issuance and trading will migrate to jurisdictions without one.
The counterargument from supervisors has been caution. The Pilot Regime caps exist partly because regulators wanted a controlled environment while they learned how DLT markets behave, including what happens when settlement fails or an infrastructure operator collapses. Raising or removing the cap before that learning is complete is, in the Commission’s view, a risk transfer onto investors. The coalition’s answer is that the learning has happened, the technology works, and the only thing being tested now is patience.