A coalition of Europe’s leading digital market operators has issued a stark warning to EU policymakers: the continent risks a permanent "migration of global liquidity" to the United States unless the bloc’s DLT Pilot Regime is urgently overhauled. In a joint letter coordinated on February 5, 2026, industry heavyweights including Securitize, 21X, Boerse Stuttgart Group, and Axiology cautioned that existing volume caps and rigid asset limits are stifling the growth of regulated on-chain markets. While the EU’s broader Market Integration and Supervision Package (MISP) aims for long-term reform, the group warned that its "structural inertia" could delay effective application until 2030—a timeline they describe as a "critical strategic vulnerability." As US regulators at the SEC and the DTCC clarify the "plumbing" for industrial-scale tokenization, European firms are calling for a "quick fix" technical update to ensure the Euro remains competitive in a world moving toward near-instant, 24/7 blockchain settlement.

• The $9 billion issuance cap currently acting as a "glass ceiling" for European tokenization platforms could be raised to €150 billion under new proposals.
• A shift in SEC guidance has provided US broker-dealers with a clear roadmap for the custody of tokenized bonds, leaving EU counterparts at a competitive disadvantage.
• Discover why removing the "six-year expiration date" on pilot licenses is considered the most vital step for institutional confidence in the Eurozone.

The central grievance of the European coalition is the vast disparity between the EU's sandbox approach and the US's pragmatic integration of tokenized securities. Currently, the EU's DLT Pilot Regime imposes strict limits on the types of assets that can be tokenized and restricts platforms to relatively low transaction volumes. For firms like 21X and Securitize, these constraints mean that even if they have the technology to handle multi-billion euro bond issuances, the law effectively forces that business to seek out more flexible jurisdictions.

The signatories argue that the EU does not need to reinvent the wheel, but simply to adjust the dials. By expanding the scope of eligible assets and removing the six-year license limit, the EU could allow pilot operators to transition into permanent, scalable market infrastructures. This is particularly urgent following the Bank of England’s decision to finalize its own systemic stablecoin rules, which suggests that neighboring markets are already preparing for a post-legacy financial era.

While Europe debates legislative timelines, US regulators have focused on clarifying how existing rules apply to new technology. In late January 2026, the SEC issued a joint staff statement that provided a definitive taxonomy for tokenized securities. By distinguishing between "issuer-sponsored" and "third-party" tokenization, the SEC has given US firms the "legal plumbing" necessary to operate within the traditional regulatory framework. This was punctuated by the DTCC's authorized launch of a service that tokenizes real-world assets already held in its custody.

This clarity has triggered a race among major exchanges. The NYSE and Nasdaq are both developing platforms for 24/7 trading of tokenized stocks, leveraging blockchain for near-instant settlement. This development directly mirrors the recent acquisition of Tokens.com by Bed Bath & Beyond, showing that the "tokenization boom" is expanding into consumer-facing real estate and retail sectors. For European operators, the fear is that by the time MISP is fully active in 2030, the primary liquidity pools for tokenized global assets will have already settled in New York.

The coalition's "quick fix" proposal is designed to be adopted without reopening the EU’s broader, more contentious market-structure reforms. The goal is to bolster the Euro’s position as a settlement currency before the market matures. If issuance and settlement activity shifts entirely toward US-based digital infrastructure, the Euro risks becoming a secondary player in the emerging on-chain economy.

As the House of Lords continues to hear testimony on the "on-ramp" utility of stablecoins, the broader European debate is shifting from "if" tokenization will happen to "where" it will be centered. The coalition of firms—including OpenBrick, STX, and Lise—insists that European investor protections are robust enough to handle higher volumes today. Without a technical update to the DLT Pilot Regime within the next six months, the "architectural vision" of a unified European capital market may remain a blueprint while the rest of the world builds the reality.

Quotes and Expert Opinions

"Global liquidity will not wait if Europe remains constrained. The structural inertia of the MISP package delays effective application until at least 2030—creating not a temporary setback, but a critical strategic vulnerability." — Joint Statement from EU Tokenization Coalition (Securitize, 21X, Boerse Stuttgart Group, et al.)

FAQs

What is the EU DLT Pilot Regime?
The DLT Pilot Regime is a "regulatory sandbox" that allows European companies to test blockchain-based trading and settlement for financial instruments. However, it currently has strict limits on the total value of assets a company can handle and a license that expires after six years.

Why are European firms worried about the US market?
US regulators, including the SEC, have recently clarified that tokenized securities are governed by the same rules as traditional stocks and bonds. This has allowed major institutions like the NYSE and DTCC to move forward with large-scale tokenization projects while European firms are still restricted by the "experimental" caps of the Pilot Regime.

What is the "Market Integration and Supervision Package" (MISP)?
MISP is a broad EU legislative effort intended to modernize and integrate capital markets across the bloc. While it contains long-term fixes for tokenization, industry leaders warn that it will not be fully implemented until 2030, giving the US a four-year head start.