Yesterday, EFAMA hosted asset management firms from across Europe to discuss how tokenisation is reshaping the industry at the Redefining assets: tokenisation and the future of investment conference. This was the first time the asset management community brought together its own experts from circa 50 different European asset management firms to tackle the biggest questions facing both individual firms and the entire European ecosystem on the path to tokenisation.
One common sentiment expressed throughout a day’s worth of panels and keynotes was that Europe should capitalise on its early mover advantage. EU policymakers delivered the Distributed Ledger Technology (DLT) Pilot Regime and MiCA, while the ECB moved forward on CBDC trials. They now need to design a regulatory framework fit to power the next growth phase in digital assets. Looking backwards, there were important milestones to feel proud of: the growing and ever larger DLT bond issuances, the rise of tokenised Money Market Funds, and the successful completion of the ECB’s digital Euro trials and its upcoming roadmap. And yet the challenges were evident too, some requiring regulatory action, others more dependent on market-driven solutions. Panellists and participants alike identified problem areas and some policy solutions, which all support the European Commission’s competitiveness agenda and the Savings & Investments Union challenge of turning Europe’s savers into investors.
Consensus emerged around several critical actions:
The urgent need to reform the DLT Pilot regime to lift the restrictive thresholds and enable the development of DLT trading and settlement for a broader and more liquid pool of assets.
The need to achieve interoperability and common standards as an ‘unlocking factor’ to drive secondary market trading and achieve scale.
Support for the emergence of various DLT-payment options, including the digital Euro, MiCA-licensed stablecoins, and tokenised commercial bank money.
Reassessment of the existing regulatory framework to enable on-chain payment mechanisms across a broader set of asset types.
Building an overarching European framework for DLT securities to avoid costly fragmentation and regulatory arbitrage across different EU jurisdictions.
Tanguy van de Werve, Director General at EFAMA, said: “At today’s conference, we saw a deep commitment and readiness from asset managers, technology providers and policymakers to help Europe transition to a DLT-based financial ecosystem. As representatives of European fund managers, EFAMA stands ready to bridge the sector’s innovation agenda with what has so far been a proactive and positive regulatory environment. We look forward to playing a critical role as key policy questions are debated in the coming months.’’
Christoph Hock, Chair of the EFAMA Tokenisation Task Force and Head of Digital at Union Investment, said: “DLT serves as a catalyst for the token economy, enabling us as an asset management industry to further enhance processes related to speed, cost efficiency, and risk management. In delivering best-in-class services to our clients, this technology will allow us to expand the investable universe and facilitate new product offerings. By addressing both assets on chain and chain on cash, tokenisation will be a transformative force for the financial industry and emerge as a key competitive factor within a strong digital capital market in Europe. EFAMA is a crucial partner for the asset management industry on its journey into the token economy.”
Stefan Brinaru, Head of Digital Assets at BNPP Asset Management, said: "Tokenisation of securities and digital cash solutions are crucial in providing our clients with the most effective and efficient business solutions. EFAMA's working group on tokenisation, gathering all the industry, is a key enabler.”
Sebastien Renaud, Head of Regulatory Change at Pictet Asset Management, said: “We all expect tokenised funds to replace the current distribution model, but we should not lose focus on the first order of priority for success: to have a secondary market for tokenised securities to avoid settlement mismatch between the tokenised fund and its underlying instruments.”
John Allan, Head of Innovation and Operations Unit at the Investment Association, said: "EFAMA’s work on tokenisation plays a vital role in aligning efforts across EU member states. As a key distribution hub and home to major fund domiciles, the EU is a critical market for UK asset managers. Greater standardisation in this space will support firms in scaling their European fund distribution capabilities and unlocking access to digital capital markets.”
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For further information, please contact:
Hayley McEwen
Head of communications and member development
