The European Commission is considering a major shift in how financial markets are regulated across the EU, proposing a centralized supervisory authority for both traditional stock exchanges and crypto platforms. This move would place oversight of these markets under the European Securities and Markets Authority (ESMA), creating a regulatory body with powers similar to the US Securities and Exchange Commission (SEC).

The plan aims to boost the competitiveness of EU capital markets by streamlining supervision, reducing the costs and complexities of cross-border trading, and supporting the growth of startups. By centralizing authority, the EU hopes to address systemic risks posed by large, cross-border firms and prevent crypto companies from exploiting regulatory loopholes in more lenient jurisdictions.

The proposal, which has backing from key figures including European Central Bank President Christine Lagarde, would empower ESMA to resolve disputes between asset managers with binding decisions. It also responds to concerns about inconsistent enforcement under the Markets in Crypto-Assets Regulation (MiCA), advocating for a unified approach across all 27 EU member states.

France, Austria, and Italy have been vocal supporters of this initiative, emphasizing the need for a single, strong supervisor to ensure market integrity, consumer protection, and financial stability in both traditional and digital asset markets.

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