EU Tokenization Cap Faces Pushback From Nasdaq and Financial Firms

Nasdaq and a group of financial and technology companies are urging European lawmakers to reconsider a proposed €100 billion ceiling on tokenized securities, arguing that the limit could restrict institutional-scale adoption of blockchain-based market infrastructure.

According to @coinbureau, Nasdaq and 27 other firms have written to the EU Council opposing the proposed limit and calling for a significantly higher threshold. The industry push comes as European tokenization projects already exceed €350 billion, more than three times the proposed cap.

The current EU framework is considerably more restrictive. The DLT Pilot Regime, which allows financial-market participants to test distributed-ledger trading and settlement, currently has an aggregate €6 billion limit. The European Commission has proposed raising that ceiling to €100 billion while also broadening the range of financial instruments eligible under the regime.

Nasdaq Pushes for Larger Tokenization Framework

The industry coalition's position is significantly more ambitious than the European Commission's proposal. Nasdaq and other markets participants are seeking either the removal of the ceiling or a threshold of as much as €1.5 trillion if a cap is retained.

The dispute reflects a broader question facing European regulators: whether the DLT Pilot Regime should remain primarily a controlled testing environment or evolve into infrastructure capable of supporting large institutional markets.

Nasdaq has been expanding its own tokenization strategy. In March, the exchange said it planned an equity-token design intended to integrate tokenized securities with existing regulated markets while preserving investor rights and issuer control. Nasdaq has also been developing European tokenized settlement infrastructure through a partnership with Börse Stuttgart's Seturion.

The company's involvement gives the European debate added significance as major exchanges increasingly position tokenization as part of the future architecture of capital markets.

EU Faces Pressure to Scale DLT Rules

European policymakers have already acknowledged limitations in the existing framework. The Commission's proposed reforms would remove individual instrument caps and increase the aggregate DLT market infrastructure ceiling from €6 billion to €100 billion.

The gap between €100 billion and the €1.5 trillion figure sought by industry groups illustrates the scale of disagreement over how quickly tokenized securities could grow.

For the EU, the decision will also affect how its regulated capital markets compete as tokenized equities, bonds and funds move closer to mainstream financial infrastructure. The next step is for the European Parliament and Council to negotiate the proposed DLT Pilot Regime reforms and determine whether the €100 billion ceiling remains in the final framework.

Writer: Victoria Hale
Technology & Blockchain Writer

Victoria Hale writes about blockchain technology, digital infrastructure, and the intersection of emerging technologies with finance. Her articles explore how new protocols and systems are shaping the evolving digital economy.

She prioritises clarity and accuracy when explaining technical developments to a general audience.