The European Securities and Markets Authority (ESMA) has announced that artificial intelligence and tokenization will become the primary focus of its new Union Strategic Supervisory Priority (USSP) starting in 2027. This initiative aims to coordinate the efforts of national regulators across the European Union in monitoring digital innovation within the financial sector.
Supervisors will map how firms utilize these technologies in products and processes that directly impact investors. The regulator plans to conduct initial checks on a subset of the most affected companies to assess how they communicate the use of emerging technologies to their clients.
The program is designed to help national authorities build expertise and establish common oversight approaches. ESMA has identified specific risks, including biased or misleading AI outputs, complex products that are difficult for investors to understand, and excessive reliance on a limited number of third-party service providers.
This new priority will operate alongside the existing USSP focused on cyber and operational resilience, which was launched in 2025. ESMA selects up to two such priorities every three years to address emerging trends. Meanwhile, the regulator is concluding its current focus on environmental, social, and governance disclosures by the end of this year.
