The European Securities and Markets Authority has launched a call for evidence to examine the potential use of tokenized collateral by central counterparties, or CCPs. ESMA said the exercise will gather input on whether tokenization could be used in central clearing and how it may affect collateral throughout its lifecycle. The authority is asking all relevant stakeholders to submit feedback by Jan. 15, 2027. The consultation looks at how tokenization could change the transfer, management, protection and use of collateral, while also seeking views on different tokenization structures. These include a "digital twin" model and assets issued directly on distributed ledger technology. ESMA Chair Verena Ross said tokenization has the potential to make European financial markets more efficient, integrated and innovative. The regulator said it will assess the responses in the first quarter of 2027 and then decide on next steps, including any regulatory or supervisory convergence action within its remit.
The European Securities and Markets Authority, or ESMA, has launched a call for evidence on the potential use of tokenized collateral by central counterparties (CCPs). The regulator invited all relevant stakeholders to submit comments by Jan. 15, 2027.
The exercise focuses on how tokenization could affect the transfer, management, protection and use of collateral across its full lifecycle. ESMA is also examining how different tokenization models may work in practice, including a "digital twin" approach and assets issued directly on distributed ledger technology.
ESMA points to possible efficiency gains
ESMA Chair Verena Ross said tokenization has the potential to make European financial markets more efficient, integrated and innovative.
Feedback review set for Q1 2027
ESMA said it will assess the feedback received in the first quarter of 2027 and decide on next steps from there, including any regulatory or supervisory convergence action within its mandate.
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