According to the executive of the European Union (EU), strict capital requirements for banks that hold crypto assets under the ongoing banking law must be implemented quickly if Europe hopes to achieve a globally agreed-upon deadline.
According to Reuters, the Basel Committee, which is made up of banking authorities from key financial centers across the world, has set a deadline of January 2025 for the adoption of capital requirements for banks holding cryptocurrencies like Bitcoin and stablecoins.
An unofficial discussion paper seen by Reuters states the following:
“For the time being, banks have very low crypto-asset exposures and only a limited involvement in providing crypto-asset-related services. Banks have expressed interest in trading crypto-assets on behalf of their clients and to provide crypto-assets-related services. From an international perspective, it would also allow the EU to fully align itself with the implementation deadline agreed on at Basel level.”
A delay could force banks to delay entering the cryptocurrency market because specific EU regulations for trading crypto assets are scheduled to take effect in 2024. The EU implements the Basel Committee standards through a statute.
To apply Basel’s crypto laws, the EU has two options: 1. Introduce a new law, 2. Expand the banking law that is currently being finalized, as per the recommendation of the European Parliament.
According to the publication, the suggested laws won’t be published until late 2023 at the earliest.
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