Banks in the US, UK, and Europe now have legal authority to issue stablecoins, custody Bitcoin, and settle tokenized funds, but capital requirements may discourage them from doing so. The obstacle lies in the Basel Committee's cryptoasset standard, which has been in effect across member jurisdictions since January 1. Under these rules, certain crypto holdings such as Bitcoin are assigned punitive risk weightings, effectively treating a position as close to a guaranteed loss. This forces banks to hold substantial capital against exposures, undermining the economic case for participating in crypto markets even where regulators permit it. The mismatch creates a situation where institutions are technically allowed to engage with digital assets but face capital costs steep enough to keep them on the sidelines. Critics argue the framework reflects outdated assumptions and may need revision to align permissions with practical capacity.
— Sponsored —
Trade smarter on BYDFI
Get a bonus on your first deposit — from $50 at $100, up to $2,000 at $20k. 200x leverage, 600+ perpetuals, deep liquidity.