European tokenization firms demand urgent DLT pilot reforms as America surges ahead
Tokenization firms across Europe have called on EU regulators to rapidly revise the DLT Pilot Regime, cautioning that existing restrictions threaten to drive blockchain-based markets toward the United States.
Several European tokenization platforms have issued a collective appeal to lawmakers in the European Union, demanding immediate amendments to the region's DLT Pilot Regime. The companies cautioned that restrictive asset ceilings, transaction volume constraints and expiring licenses are blocking the expansion of compliant blockchain-based markets, even as the United States moves forward with large-scale tokenization initiatives and settlement systems that operate in real-time.
Through a collaborative statement timed to precede an upcoming legislative discussion, tokenization platforms and market infrastructure providers including Securitize, 21X, Boerse Stuttgart Group, Lise, OpenBrick, STX and Axiology advocated for specific modifications to the DLT Pilot Regime, which serves as the European Union's experimental framework for markets dealing in tokenized securities.
According to the companies, while the EU's comprehensive Market Integration and Supervision Package establishes an appropriate strategic vision for the future, the current operational restrictions are already hampering the expansion of regulated tokenized financial instruments throughout Europe. Drawing attention to developments in the United States as a significant point of comparison, they stated:
Without timely action on the DLT Pilot Regime, the EU risks losing market relevance. The structural inertia of this package delays effective application until at least 2030 — creating not a temporary setback, but a critical strategic vulnerability.
The group further emphasized that "global liquidity will not wait" for Europe to resolve its regulatory limitations, cautioning that capital could permanently relocate to American markets as blockchain-based settlement systems continue to develop and mature.
Instead of advocating for reduced regulatory oversight, the participating companies recommended a focused technical "quick fix" designed to preserve current safeguards for investors. The proposed modifications would broaden the categories of permitted assets, increase existing caps on issuance volumes and eliminate the six-year expiration date on pilot program licenses, thereby enabling regulated market operators to expand offerings that are already operational in other regulatory jurisdictions.
According to the coalition, these modifications could be implemented rapidly via a standalone technical revision without necessitating a comprehensive overhaul of the EU's wider market structure regulatory framework.
The companies cautioned that extended postponements create the danger of diminishing the euro's competitive position in international capital markets, particularly as settlement processes and securities issuance migrate toward more efficient, fully digitized market infrastructure systems.
US regulators and exchanges advance tokenization framework
The United States has made concrete regulatory progress on the tokenization front through clarifications regarding how securities in tokenized form may be issued, held in custody and settled using existing market infrastructure platforms.
On Dec. 11, 2025, the Securities and Exchange Commission's Trading and Markets Division provided guidance on how broker-dealers may maintain custody of tokenized equities and debt securities while complying with existing customer protection regulations, indicating that securities based on blockchain technology will operate under the conventional regulatory structure instead of being classified as an entirely new category of assets.
The SEC released a no-action letter on the same day to a subsidiary of Depository Trust & Clearing Corporation, paving the way for a new tokenization service for securities markets. DTCC announced that its Depository Trust Company unit has received authorization to introduce a service that tokenizes real-world assets that are already maintained in DTC custody.
On Jan. 28, the SEC published guidance that clarified its perspective on tokenized securities, dividing them into two distinct categories: securities tokenized by the original issuers themselves and securities tokenized by independent third-party entities, a distinction intended to provide companies with more definitive regulatory clarity as tokenization activities continue to expand.
In addition to more transparent regulatory guidance from US authorities, both Nasdaq and the New York Stock Exchange have started investigating tokenization opportunities within conventional market infrastructure frameworks.
In November 2025, Nasdaq stated that obtaining SEC approval for its September proposal to offer listed tokenized equities was among its highest priorities, observing that the exchange was addressing public feedback and responding to inquiries from regulators as the approval process moved forward.
On Jan. 17, the NYSE announced it is building a platform designed to facilitate trading of tokenized equities and exchange-traded funds, subject to regulatory authorization, which would enable around-the-clock trading capabilities and near-instantaneous settlement through blockchain-powered post-trade infrastructure.