EU Regulator Seeks Tougher Crypto Rules Amid Market Abuse Concerns

The European Securities and Markets Authority (ESMA) has proposed sweeping changes to crypto regulations in the EU. The regulator wants to overhaul the bloc's rules to tackle market fraud and restrict misleading promotions by online influencers.

ESMA's recommendations aim to simplify the framework while improving investor protection and addressing innovative business models, such as decentralized finance (DeFi), staking, lending, and borrowing.

The watchdog is proposing new safeguards in areas where investors face risks that are not fully covered under the current framework. These include stricter rules for the marketing of crypto-assets, particularly when they are promoted by influencers and third parties.