Global regulators are reviewing new rules on banks’ crypto holdings after the rise of stablecoins

Global regulators are discussing possible adjustments to the rules on banks’ cryptocurrency holdings. This talk follows the increased adoption of stablecoins, triggering a US-driven response against the current regulations. The new changes are set to take effect next year.

Regarding the initial regulations, sources pointed out that the Basel Committee on Banking Supervision established these standards in late 2022. According to the perspective of senior finance officials, banks viewed these rules as barriers to crypto exposure because they require considerable capital for such assets.

Since then, the outlook on cryptocurrency has undergone a drastic change. In the present day, what US regulators once viewed as the “Wild West” of finance has evolved into an industry that has garnered significant support from the White House. 

Crypto community sparks concerns about the current crypto rules

The shift in perspective towards cryptocurrency has sparked debates at the Basel Committee, raising questions about whether current regulations remain suitable for the digital asset. On the other hand, reports from reliable sources have highlighted that leading global jurisdictions, such as the US, UK, and EU, have not yet decided to implement these rules on schedule.

According to sources close to the situation, US officials have argued that they have been at the forefront of calls for changes because they believe these standards do not align with the evolving needs of the industry, particularly regarding stablecoins.

The officials’ statement marks a significant milestone in the crypto industry, as stablecoins are now regulated in the US following the approval of the GENIUS Act. This move has led to increased adoption of cryptocurrency as a means of payment globally.

Still, the Basel standards impose high capital charges on permissionless stablecoins, such as Tether’s USDT and Circle’s USDC. Those tokens operate on public blockchain networks that are open to everyone, similar to how assets like Bitcoin work on the principles.

According to these standards, if one holds permissionless crypto assets, they will face a risk charge of about 1,250% of the exposure. Analysts commented that this rate exceeded those imposed on other risky investments. For instance, certain venture capital investments in the latest Basel capital package incur a 400% charge.

After careful consideration, some nations supported the officials’ viewpoint and emphasized that they intend to reassess these standards before they are widely adopted.

In the meantime, executives at the European Central Bank (ECB) have shared their intention to implement the current regulations first and then consider making adjustments later. When reporters asked representatives from the Basel Committee, the Federal Reserve, and the ECB to comment, they declined to respond.

Banks push for regulatory consistency in crypto rules

The EU has established a crypto framework through a recent bank capital package. This framework enables stablecoins to benefit from the same capital treatments as the assets that back them. 

To maintain their value stability, stablecoins typically rely on reserves comprising cash and short-term US government bonds. Meanwhile, the Bank of England aims to implement its newly established rules on stablecoins later this month. The bank also indicated that its team is still developing guidelines for managing crypto assets and is consulting with other jurisdictions to ensure uniformity in these regulations.

Singapore, on the other hand, announced that it would delay its timeline by a year to meet the global standards earlier this month. Hong Kong has also revealed its plans to release new rules in 2026, but has recently suggested loosening the requirements for licensed stablecoins. 

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