EU Regulators Open the Door for a Tokenized Securities Standards Group

Three of Europe's top financial authorities want the industry to help write the rulebook for tokenized securities. The European Central Bank, the European Commission and the European Securities and Markets Authority are accepting nominations for an industry-led group that will draft common standards for holding and settling tokenized securities, according to a release published Monday.

The body is called the European Tokenisation Standards Group (ETSG). EU industry associations, global institutions, private firms and fintech companies can apply by Nov. 27, with work kicking off in January 2027. The three EU institutions will sit in as observers rather than full members.

The ETSG has a concrete brief: build technical and market standards so companies can hold and settle tokenized securities across different distributed ledger technology platforms, and make sure those platforms talk to existing financial systems. Its mandate sets an initial set of standards for early 2028, feeding into Appia, the Eurosystem's blueprint for Europe's tokenized financial markets.

The institutions flagged fragmentation as the main risk, warning it could blunt the gains of tokenization. They said the group may recommend ways for EU authorities to push firms toward adopting its standards. It's not the Eurosystem's first move here: in September it launched Pontes, a system letting financial institutions settle wholesale transactions in tokenized assets using central bank money.