The global banking regulatory standards legislature plans to finalize its review of crypto-assets closer to the end of this year.
The Basel Committee on Banking Supervision released an update on its May 27 meeting. During that meeting, it said significant progress had been made on a consultation paper on a “prudential approach to bank risk with respect to crypto-assets.”
Last year, the body first published a consultation paper proposing strict capital requirements for banks with access to cryptocurrency, in addition to applying the existing framework to cryptocurrency and issuing guidance to address any gaps.
It has received feedback from stakeholders, on which the next consultation will be built. The document is scheduled to be published around the end of this year, according to the official announcement.
Recent events have further underscored the importance of having a global minimum prudential framework to mitigate the risks associated with cryptoassets.
The first version of the consultation paper addressed, among other things, credit and market risk requirements for stabilization mechanisms in tokens.
In addition to its cryptocurrency plans, the body also considered climate-related financial risks and vulnerabilities in the global banking system.