European Regulators Warn of Rising Cyberattacks and Crypto Risks
European regulators have issued warnings about increasing cyberattacks and growing exposure to crypto-assets in the financial system. The latest risk report from the European Supervisory Authorities (ESAs) stresses the need for stronger resilience. This is crucial as digital markets become more connected with traditional finance.
Cyber Threats Target Banks and Market Infrastructure
The EU Agency for Cybersecurity (ENISA) reports a sharp rise in cyberattacks. Banks and market infrastructure face frequent ransomware and DDoS attacks. These attacks are often linked to geopolitical tensions.
The Digital Operational Resilience Act (DORA) took effect on January 17, 2025. It requires banks and market operators to strengthen defenses, improve reporting, and manage risks from critical ICT suppliers. The law aims to close security gaps before cybercriminals exploit them.
Crypto Growth Challenges Regulators and Banks
Regulators say contagion risks from decentralized finance (DeFi) are limited for now. However, ties between banks and digital assets are growing quickly. The ESMA report notes that pro-crypto policies under former US President Trump helped push total crypto market capitalization to a record €3.3 trillion by the end of 2024.
By April 2025, crypto valuations dropped 18% to €2.7 trillion due to macroeconomic pressures. Despite this, banks continue expanding their digital services, blurring lines between crypto and traditional finance.
Regulators now focus on whether the financial system can handle crypto’s volatility spilling into mainstream markets. Data from the European Banking Authority (EBA) and the European Insurance and Occupational Pensions Authority (EIOPA) show cyber risks remain high in the second half of 2025.
The report urges firms to strengthen cyber defenses as blockchain adoption and Wall Street–style crypto engagement grow. While crypto offers real opportunities, risks are increasingly recognized by regulators and investors alike.
