Capital markets News

Basel crypto rules for banks delayed to 2026

basel crypto rules

The Basel Committee, the global standard setter for regulating banks, has delayed the implementation of the Basel rules for crypto-assets by a year to January 2026. Its definition of crypto-assets is broad, including cryptocurrencies, stablecoins and tokenized securities such as stocks and bonds.

“The revised implementation date will help to ensure that all members are able to implement the standard in a full, timely and consistent manner,” said the Basel Committee’s oversight body.

The first set of crypto-asset rules was finalized in late December 2022. However, a year later the Committee consulted on proposals for substantial changes. The Committee plans to revise the rules later this year.

The proposed amendments tighten the requirements for crypto-assets to be classified in the low risk Group 1. Tokenized securities usually fall into this group. Under the draft amendments, any security tokens issued on a public blockchain automatically fall into the higher risk Group 2, which has prohibitive capital requirements. For example, U.S. banks would have to set aside a dollar of capital for every dollar of tokenized securities they hold on a public blockchain. The same applies to any other digital securities that don’t meet the risk requirements set out in the standard.

Industry bodies GFMA, FIA, IIF, and ISDA object to this change. They also aren’t happy with another proposal regarding ‘infrastructure risk’. Before the first standard was published, the Committee had proposed that all Group 1 assets, including digital or tokenized securities, incur a 2.5% infrastructure risk add-on. The final 2022 standard removed the add-on, but the 2023 proposed amendments re-introduce a watered-down version at 0%. However, it gives local regulators the leeway to increase the percentage. 

The industry bodies want to see all references to the infrastructure risk dropped. They also addressed several other proposed changes.

Meanwhile, Erik Thedéen, the Governor of Sweden’s Riksbank will become the new Chair of the Committee in June this year. He will replace Spain’s Pablo Hernández de Cos who has been in the role for more than five years.

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