From 2027, the European Securities and Markets Authority (ESMA) intends to focus a separate supervisory direction on the use of artificial intelligence and tokenization in the financial industry. National regulators of EU countries will need to identify areas where tokenization is developing and gather information on how companies are applying or planning to apply new technologies in products and internal processes that can directly affect investors. As part of this work, supervisory authorities will conduct initial inspections of several companies most actively using these solutions. The main goal of the initiative is to accumulate practical experience and form unified approaches to assessing technological changes at a pan-European level.
The new direction is part of the pan-European strategic supervisory priorities through which ESMA coordinates the work of national regulators on issues of common interest to the EU financial market. Among the potential risks to be monitored are incorrect or misleading AI outcomes, financial products that are not sufficiently understandable for clients, and excessive dependence of companies on a limited number of external technology providers. Regulators also intend to analyze the information that financial organizations disclose to investors when implementing new technologies. Special attention will be paid to examples of AI and tokenization applications that allow for more reliable results, reduce the impact of algorithmic bias, and improve the performance of financial services.
The priority on AI and tokenization will operate concurrently with the direction dedicated to cyber and operational resilience, which ESMA launched in 2025. In parallel, separate supervisory work in the field of disclosure of environmental, social, and governance factors is being completed. ESMA defines pan-European strategic priorities every three years, choosing no more than two directions related to new phenomena and trends in financial markets. In the case of AI and tokenization, the regulatory approach will be built not only around identifying risks but also around sharing practices among national bodies. This should help compare ways of applying technologies in different jurisdictions and develop more uniform principles for overseeing digital financial products.
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