AFME Proposed EU Capital Market Reforms
The trade body published a position paper in September 2026 advocating for a decentralized settlement architecture.
Updated on Oct. 6, 2026 in Financial Services
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The Association for Financial Markets in Europe (AFME) released a proposal in September 2026 to reform EU capital market infrastructure. The group calls for unbundling central services to foster greater competition.
Why it matters
AFME contends that current centralizing models create post-trade monopolies and potential single points of failure. The proposed reforms aim to integrate fragmented capital markets through a new network-based architecture.
AFME recommends increasing the settlement scheme cap to 50 billion euros from the current 10 billion euro limit. The proposal follows the DLT Pilot Regime, which failed to attract significant institutional participation.
The players
Association for Financial Markets in Europe
This is an industry body that represents a broad range of European and global participants in wholesale financial markets.
The details
The proposed model features a network layer managed by regulated firms and a competitive services layer. By using DLT account keepers that hold central bank accounts, AFME seeks to allow settlement without relying on a central operator.
Timeline
May 2026: AFME submitted initial MISP proposals.
September 2026: AFME published its position paper.
October 6, 2026: Article publication date.
Market Landscape
AFME's proposal directly contrasts with the DLT Pilot Regime, which failed to attract significant institutional participation. By advocating for unbundled services, the association seeks to move away from the post-trade monopolies that currently dominate European capital markets.
These proposed changes may eventually alter the landscape of trade settlement services for institutional investors and commercial banks. Future implementation of these schemes could change the cost structure and efficiency of post-trade market operations.
The takeaway
The move suggests a shifting priority toward decentralized financial networks to solve long-standing fragmentation in the European market. Investors should monitor whether regulatory bodies shift their focus from centralized oversight toward these proposed competitive, network-based models.
Further reading
For more context on market infrastructure, see Financial Services.
Source note: This article includes information reported by PostTrade 360°.
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