In a statement released Friday, the European Central Bank (ECB) expressed its full support for the European Commission's proposal to transfer regulatory authority over systemically important cross-border capital markets companies, such as large trading platforms and crypto companies, to the Securities and Markets Authority (ESMA). The ECB stated that transferring the authorization, monitoring, and enforcement powers for all crypto asset servicers (CASPs) from member state regulators to the ESMA will ensure regulatory convergence, reduce market fragmentation, and mitigate cross-border risks. Currently, under the MiCA framework, crypto service providers can choose to register in any member state and serve the entire EU, resulting in companies like Kraken, Coinbase, and Bitpanda being distributed across different jurisdictions. The ECB emphasized that with the increasing ties between banks and crypto companies, a centralized regulatory system can prevent the migration of risk to the banking system and maintain financial stability. This proposal still requires negotiations between EU legislators and governments, followed by further action by the European Parliament.