The European Securities and Markets Authority (ESMA) has designated artificial intelligence and tokenization as its primary digital innovation oversight priorities for 2027. EU national regulators will map the use of these technologies in investor-facing products, conduct inspections at affected financial institutions, and establish a unified supervisory approach across the bloc. Key risk areas identified by ESMA include biased or misleading AI outputs, challenges investors face in understanding complex tokenized products, and excessive reliance on a concentrated number of third-party technology providers. The regulatory body aims to address these vulnerabilities through coordinated supervision and targeted examinations of firms integrating these emerging technologies.