Governing IoT Cybersecurity in the Digital Single Market: A Techno-Economic and Policy Analysis of the EU Cyber Resilience Act

Abstract

The European Union’s Cyber Resilience Act (CRA), introduced in late 2024, establishes essential cybersecurity requirements for connected digital products within the EU’s digital single market. Aiming to systematically improve transparency, reduce vulnerabilities, and address misaligned incentives, the CRA introduces riskbased conformity assessment procedures, transparency obligations, and a CE marking scheme. This paper analyzes the CRA from a techno-economic perspective, recognizing that it is a crucial step in addressing systemic digital vulnerabilities by complementing the existing EU cybersecurity framework and bridging persistent regulatory gaps. However, while its intent is commendable, the CRA remains premature and underdeveloped in several key areas, from enforceability to economic impact. While it rightly identifies insecure digital products as potential vectors for systemic risks, its current design raises implementation feasibility concerns, especially for SMEs and microentrepreneurs. We argue that standardization and effective conformity assessment mechanisms play a critical role in achieving the CRA’s objectives. Yet, harmonized norms remain insufficient, and challenges in scaling third-party assessment frameworks persist. We believe multidisciplinary foundations are essential for enforceable cybersecurity frameworks: from robust technical and economic evaluation methods, awareness and education initiatives, and enhanced international collaboration for threat intelligence sharing. The CRA’s future success will depend on its adaptability to evolving threats, its capacity to work in synergy with existing regulations, and its sensitivity to the economic realities of diverse stakeholders. Without careful calibration, the CRA risks to fall short of its intended impact—or worse, inadvertently introducing new barriers to innovation and competitiveness.

Keywords: Cybersecurity, Cyber resilience, CRA, Cybersecurity economics, cybersecurity policy