In Brief:
- The agency is seeking feedback on a pilot programme for DLT-based market infrastructures.
- The aim is to ensure more efficient, secure, and cost-effective management of the data stored on DLTs.
- Stakeholders have until March 4, 2022 to leave comments.
In order to accommodate the rising usage of blockchain technology in financial markets, Europe’s top securities regulator is soliciting submissions on the need to alter the regulatory technical standards (RTS) on reporting and transparency requirements. The European Union’s market regulator is calling for opinions on whether or not regulations should be modified to accept tokenized securities.
As stated by the regulator, “The aim is to ensure more efficient, secure, and cost-effective management of the data stored on DLTs while preserving its quality, usability, and comparability.”
The call for evidence aims to gather feedback from stakeholders on the use of distributed ledger technology (DLT) for trading and settlement, as well as the need to alter regulatory technical standards (RTS) on regulatory reporting and transparency. ESMA is looking at whether existing rules need to be changed to make them applicable to securities traded using distributed ledger technology (DLT).
The agency is seeking feedback on a pilot programme for DLT-based market infrastructures, including transaction reporting exemptions and mechanisms for regulators to gain access to transaction data, financial instrument reference data, and transparency data.
Stakeholders have until March 4, 2022, to leave comments. ESMA will then assess whether revisions to the RTS are justified based on the feedback received. The DLT Pilot is due to commence early in 2023. Before proposing the final document RTS to the European Commission for adoption, ESMA will consult on its proposal if any changes are required.
Previously, the Baltic country Estonia also published a series of frequently asked questions (FAQs) to ease fears and doubts about the new crypto regulations.
