Continuous Glucose Monitoring (CGM) systems have emerged as game-changing technologies in diabetes management, offering real-time glucose tracking, forecasting algorithms, and integrations with digital health platforms. Such technologies promise enhanced glycemic control, enhanced patient outcomes, and reduced dependency on traditional finger-prick glucose monitoring. However, introducing artificial intelligence (AI), cloud connectivity, and biosensor technology into CGM systems has ushered in complex regulatory problems, particularly within the European Union, based on the Medical Device Regulation (MDR 2017/745). This study examines the nexus between CGM technology innovation and the changing European regulatory environment. It explores how technological innovations in AI, non-invasive biosensors, and telemonitoring are transforming diabetes care while also challenging the resilience and efficacy of existing regulatory structures. A qualitative approach was utilized, involving semi-structured interviews with influential stakeholders like healthcare practitioners, manufacturers, and regulatory professionals. Thematic analysis determined emerging challenges, opportunities, and stakeholder views. Findings indicate an intense tension between accelerated innovation and regulatory adherence. Reclassification of CGMs as medical devices under the MDR has added documentation obligations, extended approval periods, and increased compliance costs, particularly onerous for SMEs. While stakeholders appreciate the value of safety and post-market surveillance, some are concerned that the MDR's stringency can hinder innovation, delay patient access to life-saving technology, and render the EU less competitive in the medtech sector. On top of that, AI validation protocol regulatory gaps, interoperable data standards, and cybersecurity framework weaknesses were repeatedly named as regulatory blind spots when it comes to CGM systems. The study concludes by proposing adaptive regulatory strategies, such as low-risk CGM upgrade fasttrack processes, more specific AI-specific validation guidelines, and greater cross-sectoral collaboration between developers and regulators. These measures could align innovation with regulation, rendering CGM technologies safe, accessible, and sensitive to patient needs. This research contributes to the broader debate on digital health regulation. It provides practical recommendations to policymakers, regulators, and medtech innovators seeking to comply while promoting innovation in the CGM arena