The major financial trade bodies are actively lobbying the Basel Committee on Banking Supervision (BCBS) to revisit the cryptoasset rules for banks and postpone their implementation. They view the rules as limiting the ability of banks to engage with tokenization, stablecoins and crypto more broadly. At the same time, Hong Kong has now finalized its implementation of these rules, scheduling them to come into force on 1 January 2026, the date originally set by the Basel Committee. The Hong Kong Monetary Authority (HKMA) wrote to banks ten days ago confirming the date. Unlike Hong Kong, many other jurisdictions have not yet finished preparing for implementation.
The problem is that the Basel rules treat tokenized assets on permissionless blockchains – including stablecoins – in the same risk category as cryptocurrencies. These attract a 1250% risk weighting, meaning banks must set aside HKD 1 in capital for every HKD 1 in stablecoins held. The HKMA is planning to grant the first handful of stablecoin licenses by early next year.
These rules would be less of an issue if stablecoins were to sidestep banks. However, Hong Kong’s initial stablecoin KYC rules are stringent, requiring all users to be identified, which works better for stablecoins issued by banks rather than crypto firms. That’s because banks are accustomed to operating in that way. One of the contenders for a license is a bank. Anchorpoint Financial is a consortium involving Standard Chartered Bank, which also took part in the stablecoin sandbox. Hong Kong’s encouragement of tokenization and stablecoins on the one hand and stringent Basel rules on the other is a conundrum noted by others.
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