In March 2018, the European Commission presented a Proposal for a Regulation on (financial return) crowdfunding service providers (CSPs) with a dual objective: to set up a single, EU-wide authorization regime for CSPs; and to ensure that duly authorized CSPs operate in a safe and sound manner. Over two years later, in July 2020, the Council of the European Union adopted its First Reading Position which reflects the compromise reached in negotiations with the European Parliament and brings about significant changes to the Commission Proposal. This study critically analyzes the objectives, economic rationales, and fundamental principles of the proposed EU Regulation on crowdfunding; highlights its weaknesses and inconsistencies; and offers proposals for refinement and improvement.