European regulator discusses tokenized stocks and need for safeguards

The global tokenized assets market, valued at approximately $600 billion, is seeing Europe lead in fixed-income issuance. In 2024, Europe accounted for more than half of these assets, underlining the region’s prominence in the tokenization space.

Natasha Cazenave, executive director of ESMA, emphasizes the need to balance innovation with investor protection. She warns that many tokenized equities, treated as derivatives, could confuse investors, pointing to the necessity for clear communication and appropriate safeguards.