Key Takeaways
- • ESMA launched a consultation on tokenized collateral used by European central counterparties (CCPs), with 30 questions covering settlement finality, ownership rights, client protection and liquidity risks.
- • The Council of the European Union agreed proposals giving ESMA greater supervisory authority over significant trading venues, central securities depositories and clearing institutions, and expanding the DLT Pilot Regime; the proposals still require legislative agreement.
- • The Monetary Authority of Singapore outlined its digital settlement approach and plans to settle tokenized MAS Bills using wholesale CBDC, following a 2025 trial involving three banks, while raising concerns about stablecoin stability under market stress.
- • Close to $730 million left US spot bitcoin ETFs in two sessions earlier in October, while Bitcoin held the low $80,000s; the outflows so far this month were around $400 million, according to the commentary.
- • September CPI showed headline inflation at 3.7% year over year and annual core inflation at 2.6%, with the Fed meeting on October 27-28 seen as the next key catalyst for crypto.
Summary
Regulators are increasingly testing whether tokenized assets can serve as collateral, settle reliably and keep their legal protections under market stress, according to commentary from Brickken co-founder and CEO Edwin Mata. The European Securities and Markets Authority (ESMA) has opened a consultation on tokenized collateral in European clearing markets. The paper highlights the distinction between technical control of a token and legal ownership, and the need for enforceable rights when tokenized records and traditional registers diverge or assets must be recovered in insolvency. ESMA is also examining whether automated collateral transfers could concentrate liquidity demands during periods of stress.
On the legislative side, the Council of the European Union has agreed proposals that would give ESMA greater supervisory authority over significant trading venues, central securities depositories and clearing institutions. The package also proposes expanding the DLT Pilot Regime and allowing eligible operators to serve multiple EU markets under one licence. According to the Council, approximately €10 trillion in European household savings sits in low-yield bank deposits. The proposals still require legislative agreement. In Singapore, the Monetary Authority of Singapore has outlined its approach to digital settlement, covering tokenized deposits, stablecoins and central bank digital currencies, and plans to settle tokenized MAS Bills using wholesale CBDC following a 2025 trial involving three banks. MAS has raised concerns about stablecoins maintaining their value during market stress, particularly in large wholesale transactions. The IMF has also published an October analysis on the financial stability implications of tokenization.
In crypto markets, Trace Finance CEO Bernardo Brites described consolidation after a decline of more than half from last October's record to this summer's low. Close to $730 million exited US spot ETFs in two sessions earlier this month, including the largest daily outflow since June, while Bitcoin held the low $80,000s. Brites characterized the ETF slowdown as a pause rather than an exit, noting that outflows of around $400 million this month are a fraction of September inflows and under 1% of the more than $100 billion these funds hold. He identified the Fed meeting on October 27-28 as the month's key catalyst. XYO co-founder Markus Levin noted September CPI rose to 3.7% year over year, driven largely by a 9.1% jump in gasoline prices, with monthly core CPI at 0.3%, above expectations, and annual core inflation at 2.6%. Levin said sticky inflation could constrain Fed easing, though he did not view the data as an automatically bearish signal for Bitcoin.
On regulation, Flowdesk co-founder and CEO Guilhem Chaumont said regulation is determining which firms remain in the market and described licensing work as a commercial opportunity. He cited the MiCA effect, under which the addressable market has shrunk along with the number of competing firms. He also noted that with the CLARITY Act stalled in the Senate, US rules are arriving agency by agency, including the SEC's custody proposal for advisers and funds.
On the legislative side, the Council of the European Union has agreed proposals that would give ESMA greater supervisory authority over significant trading venues, central securities depositories and clearing institutions. The package also proposes expanding the DLT Pilot Regime and allowing eligible operators to serve multiple EU markets under one licence. According to the Council, approximately €10 trillion in European household savings sits in low-yield bank deposits. The proposals still require legislative agreement. In Singapore, the Monetary Authority of Singapore has outlined its approach to digital settlement, covering tokenized deposits, stablecoins and central bank digital currencies, and plans to settle tokenized MAS Bills using wholesale CBDC following a 2025 trial involving three banks. MAS has raised concerns about stablecoins maintaining their value during market stress, particularly in large wholesale transactions. The IMF has also published an October analysis on the financial stability implications of tokenization.
In crypto markets, Trace Finance CEO Bernardo Brites described consolidation after a decline of more than half from last October's record to this summer's low. Close to $730 million exited US spot ETFs in two sessions earlier this month, including the largest daily outflow since June, while Bitcoin held the low $80,000s. Brites characterized the ETF slowdown as a pause rather than an exit, noting that outflows of around $400 million this month are a fraction of September inflows and under 1% of the more than $100 billion these funds hold. He identified the Fed meeting on October 27-28 as the month's key catalyst. XYO co-founder Markus Levin noted September CPI rose to 3.7% year over year, driven largely by a 9.1% jump in gasoline prices, with monthly core CPI at 0.3%, above expectations, and annual core inflation at 2.6%. Levin said sticky inflation could constrain Fed easing, though he did not view the data as an automatically bearish signal for Bitcoin.
On regulation, Flowdesk co-founder and CEO Guilhem Chaumont said regulation is determining which firms remain in the market and described licensing work as a commercial opportunity. He cited the MiCA effect, under which the addressable market has shrunk along with the number of competing firms. He also noted that with the CLARITY Act stalled in the Senate, US rules are arriving agency by agency, including the SEC's custody proposal for advisers and funds.
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