Catenaa, Friday, August 22, 2025- Major financial trade groups are urging the Basel Committee on Banking Supervision to pause the 1,250% capital requirement for crypto exposures.
They called the rule outdated amidst rapid developments in blockchain technology and regulated digital asset markets.
The Global Financial Markets Association and the Institute of International Finance highlighted that current rules make it uneconomical for banks to meaningfully participate in crypto, driving digital assets outside traditional supervision.
The groups criticized the Basel framework’s rigid distinctions between permissioned and permissionless ledgers, which impose punitive capital charges even on low-risk assets such as tokenized US Treasury securities.
They recommended removing the “infrastructure risk add-on” and revising limits for Group 2 cryptoassets, citing evidence that Bitcoin and Ethereum trade with volumes and volatility suggesting far lower capital requirements than current rules demand.
Major ETH treasury companies have pitched institutional investors, with corporate treasuries controlling over $28 billion in Ether. JPMorgan introduced its fully dollar-backed JPMD digital deposit token on Coinbase’s Base network, targeting institutional clients, while Bank of America confirmed preparations for stablecoin offerings.
Concerns persist over stablecoins’ impact on traditional deposits, as they carry no federal insurance despite guaranteed government bond backing.
