Financial Regulation, Political Context, and Technology in the European Union

Three decades after the establishment of the European Single Market, the ongoing digital transformation of its core socioeconomic pillars generates regulatory shifts. These shifts are also initiated by geopolitical pressures. Within its data-driven economy, innovative financial solutions and technologies strive to unfold against the backdrop of what is now a multilayered, complex regulatory environment. This chapter dismantles this complexity by outlining the main regulatory building blocks relevant to the European Union’s financial industry vis-à-vis the policy goals of digital and economic sovereignty. Given the focus of this book on decentralization technologies in the financial industry, it then contextualizes the impact of such policy on these and discusses the present dynamics between regulation and innovative technology.