The Basel Committee, which is composed of banking regulators from the European Union and other countries, has agreed on a deadline for the application of capital requirements for banks’ interaction with cryptoassets.
This committee is made up of more than 50 countries, and is in charge of determining the regulations and rules for an ideal and safe operation for the most important banking entities worldwide.
On this occasion, the executives state that if Europe wishes to continue with the margin established by the committee, it must accelerate the adoption of strict capital rules for banks holding cryptocurrencies.
Through an informal discussion paper to which Reuters had access, the executives agreed:
“At the moment, banks’ exposure to cryptos is very low and their involvement in the provision of crypto-related services is limited.”
Importantly, by 2024, separate rules for crypto trading come into force for the EU, despite the EU’s desire to follow international standards.
Through complementary comments, the European Central Bank (ECB) emphasized:
“The potentially increasing involvement of (financial) institutions in crypto-related activities needs to be fully reflected in the Union’s prudential framework. In order to adequately mitigate the risks of these instruments to the financial stability of institutions.”
This initiative, aims to provide greater security in this type of transactions to address adverse developments that arise, with increasing frequency, in the cryptocurrency market.
However, it is not yet clear whether the new European legislation will follow the parameters of the Basel committee, but everything points to the fact that it could be so, and in this way, we could see a regulated crypto market.