Overview

• ESMA executive director Natasha Cazenave said many tokenized equity products are synthetic exposures structured via derivatives or SPVs, leaving buyers without voting or dividend rights.
• Cazenave backed upgrades to the EU’s DLT Pilot Regime and related rules under MiCA to add safeguards, enable real-time oversight, and potentially make the sandbox permanent and more flexible.
• The World Federation of Exchanges recently called for tighter supervision of tokenized stocks, and ESMA pressed for international coordination through bodies such as IOSCO and the FSB.
• Industry rollout continues as Robinhood launches tokenized stocks in the EU and Coinbase and Kraken advance plans, with recent offerings prompting OpenAI and SpaceX to clarify that tokens are not company-issued equity.
• Despite growth to an estimated $600 billion market and Europe’s lead in 2024 tokenized fixed-income issuance (over half of €3 billion), ESMA noted most initiatives remain small, illiquid, and fragmented.