According to a study by the Basel Committee on Banking Supervision, the world’s largest banks are worth approximately 9.4 billion euros ($9 billion). cryptocurrency has investment.
The international standard setter is considering new rules for the capital that lenders must hold against innovative assets.
Basel Committee Announces Banks’ Cryptocurrency Risk Amount
Mainly Bitcoin (BTC) and Ethereum (ETH) Risk exposure represents 0.14% of the total exposure of the 19 banks sending data, or just 0.01% across all banks, and this first-of-its-kind survey will have a clear impact on the rules.
The following statements were used in the study written by Renzo Corrias, Committee Secretary:
“The template sent to banks is specifically designed to support the Committee’s two advisory papers on the prudential assessment of banks’ cryptocurrency risks, published on June 10, 2021 and June 30, 2022.”
In this article, Corrias referred to two documents in which the Basel Committee, a group of national regulators that set safety norms for banks designed to avoid 2008-style financial crises, tentatively set tough rules to govern the way banks enter cryptocurrencies.
The plans set a tough capital requirement for currencies like Bitcoin and Ethereum, as well as algorithmic stablecoins. Planned regulations may restrict lending and mean that in practice banks do not have much incentive to enter these markets.
Milder rules may apply to hedged exposures and other types of asset-pegged stablecoins.
*Not investment advice.
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