The European Digital Finance Association (EDFA), a pan-European group representing over 2500 Fintechs, including investment crowdfunding platforms, has issued a letter urging the European Union (EU) to raise the securities crowdfunding threshold from the current €5 million to €12 million (~$14.3 million).
The European Crowdfunding Service Providers Regulation (ECSPR) was enacted by the EU in 2021. The complete application took a few years (2023), but today, under the rules, a securities crowdfunding platform may raise up to €5 million (~ $5.89 million) from investors across all EU member states.
Today, there are over 200 ECPSR-approved platforms operating across Europe, but challenges remain, and industry insiders have highlighted shortcomings with the current rules.
Last September, the EDFA issued a statement on the lost opportunity for crowdfunding under ECSPR, warning that Europe’s growth potential in online capital formation “risks being left untapped.”
The letter, addressed to the President of the European Council, António Costa, and the Heads of State and Heads of Government of the Member States of the EU, requested that they “urgently raise the threshold set out in Article 1 of the ECSPR from € 5 million to € 12 million, while leaving all other provisions of the Regulation unchanged.”
The letter is timed to align with the EU Leaders’ retreat on February 12th, 2026, where one of the objectives is to strengthen the single market as an urgent strategic imperative.
The request to raise the threshold also aligns with a rule governing the issuance of securities without a prospectus, which is now set at the same €12 million.
“At a time when European competitiveness, strategic autonomy and innovation capacity are at the top of the political agenda, this swift and proportionate adjustment would send a strong signal that Europe is serious about mobilising private capital for growth—without reopening or destabilising the existing regulatory framework. We respectfully urge the European Council to support this adjustment as soon as possible,” states the missive.
The letter is signed by 13 Fintech associations, including those of Germany, France, and Italy.
CI reached out to Karsten Wenzlaff, who leads Digital Invest Germany and serves on the EDFA board, for additional insight. We asked about past concerns regarding the securities crowdfunding marketplace, and Wenzlaff explained that they wanted to request a change that could be made immediately.
“This is a quick fix which can be done in a simplified procedure, as part of a European package for competitiveness,” stated Wenzlaff, who added that other items may take more discussion.
CI inquired about platform liability, a challenge that has affected platforms in the past, and clarified that this is a matter for member states to address.
Related: European Group Worries About EU Falling Behind in Tokenization, Sends Letter to EU Leadership Requesting Change
Regarding the possibility of tax exemptions to encourage investment, he said they are helpful, but taxes are a matter for individual EU member states.
Tokenization is a hot topic in the US, and policymakers are working diligently to advance the concept of digital securities. Wenzlaff said that tokenization is already possible, but the main issues are the exchanges and the limited EU DLT pilot framework.
Regarding the need for secondary markets to provide liquidity, Wenzlaff said they do not yet exist for securities issued under ECSPR, but they believe this can be addressed within the DLT framework or under tokenization rules.
Online capital formation continues to iterate globally. Europe is an important market that could do more to support early-stage firms by liberalizing markets and encouraging risk capital. While many in the EU recognize the need to move quickly to update rules and support innovation, it is not clear whether the political will exists to drive such dramatic changes across the European Union.