The future of financial markets: between regulation and innovation

This article is part of a three-part series:

• The first article delves into how the Societe Generale group and in particular SGSS have organised themselves to face these transformations, highlighting the actions taken and the most significant achievements.

• The second publication focuses on operational workflows and infrastructures, essential elements for the creation of a common framework.

• This third article examines the state of the art of the main regulatory requirement and market trends shaping the near future.

Recent speeches by Piero Cipollone¹ and Ulrich Bindseil² underscore the transformative role of distributed ledger technology (DLT) and tokenisation in addressing fragmentation, complexity and technological inefficiencies in European capital and payments markets.

Alongside this fact, the issue of monetary sovereignty is equally strong, and the current international context only confirms this. It is important to highlight that, these technologies are not an incremental improvement, but a new way of operating. The issuance, or representation in token format, of assets generates new operating models, which make it possible to solve many of today's inefficiencies - just think of the reconciliation of movements or the barriers to access to capital - and open the way to unprecedented opportunities.

These are the reasons why Europe has been engaged for years in a process of dialogue with the market with the aim of equipping itself with the necessary rules to fuel innovation that can be translated into progress and sustainability. SGSS, as a leading securities services provider in Europe, has been actively involved in the various instances of this journey, the main results of which are summarised below.

Europe’s regulatory response: MiCAR and beyond

To support innovation, Europe has developed a robust regulatory framework:

• Markets in Crypto-Assets Regulation (MiCAR), effective from 30 December 2024, provides rules for crypto assets to operate such as e-money tokens (EMTs) or asset-referenced tokens (ART).

• MiCAR excludes crypto assets classified as financial instruments under MIFID (e.g. shares, bonds, units of Funds), which remain governed by traditional securities laws.

• European Supervisory Authorities (ESAs), including EBA and ESMA, are developing Regulatory Technical Standards (RTS) and guidelines, as well as public statements, to which SGSS have contributed as members of the ABI Working Group on Digital Currencies and Cryptocurrencies. These include guidelines for the qualification of crypto assets as financial instruments and guidelines aimed at clarifying the criteria for assessing the competencies of staff employed by crypto-asset service providers (CASPs).

The Pilot Regime

To enable DLT-based securities distribution through secondary markets (e.g. multilateral trading facilities), Europe introduced a Pilot Regime offering temporary exemptions from current legislation. However, uptake has been limited. In its June 2025 report³, ESMA proposed revisions to better align the regime with market needs, supported by feedback from Consob and the French authority AMF⁴. The Authority has submitted to the European Commission (EC) a proposal for revision aimed at making the pilot regime more suitable for the needs of business development. Regulatory, operational and medium-long term perspective are the stakes on the table. It is now up to the EC to integrate these suggestions into its analysis and to produce the recommendations it deems appropriate for the European Parliament and the Council. Options currently under discussion include extending the pilot scheme, amending it or moving it into permanent legislation.

The European Central Bank’s strategy on Digital Euro

On the cash side of trading, the European Central Bank (ECB) has finally announced the results of the exploratory phase of a wholesale digital Euro and how it intends to proceed with the development. These works began in an initial discussion with the market in September 2022. On that occasion, SGSS emphasised the need for an "on-chain" digital currency, i.e. one that is also suitable for circulation on DLT, following the model proposed by the Banque de France. This condition is essential to access all the potential benefits of securities tokenisation. The ECB’s roadmap includes:

• PONTES: DLT platforms will be fed with the central bank money of TARGET services, through "bridges" (Pontes is latin for bridges)⁵ that will be tested in a pilot phase starting end of 2026.

• APPIA: A long-term project which has the ambition to shape innovative, integrated and above all "future-ready" financial ecosystems (as the APPIA route has proven to be since 312 BC).

A Framework for Innovation and Growth

The European regulatory framework on digital assets and DLT represents an opportunity to build more efficient, secure, and transparent financial markets. The challenge now will be to transform this framework into concrete practices, capable of fostering the growth of the sector and reaping the full benefits of digital innovation.

Oscar Maffioletti, Deputy General Manager Staff, Societe Generale Securities Services