Crypto industry pushes back on plan to centralize EU oversight under ESMA

The European Commission (EC) is preparing a draft proposal to grant the European Securities and Markets Authority (ESMA) supervisory power over the crypto sector, a move that is drawing strong opposition from the industry, Cointelegraph reports. Faustine Fleuret, head of public policy at DeFi lending protocol Morpho, argued that granting excessive regulatory authority to ESMA could slow the pace of innovation in Europe's crypto and fintech industries. Fleuret stated that if ESMA were to handle all licensing and supervision, it would not only require vast resources but also reduce the decision-making speed and flexibility of startups and emerging projects. She noted that such a centralized approach could be particularly damaging for early-stage companies, for which close cooperation with their national regulators is essential.