Seeking Alpha
2021-09-21 17:38:34

Commercial banks oppose Basel's 'overly conservative' proposals on crypto - WSJ

JPMorgan Chase ((JPM +0.5%)), Deutsche Bank ((DB -0.8%)) and other banks in the Global Financial Markets Association ("GFMA") oppose the "strict" rules for capital requirements on bitcoin exposure set out in June by the Basel Committee on Banking Supervision, the Wall Street Journal reports. Bank regulators remain concerned about consumer protections and the potential for cryptocurrencies to be used in money laundering, and terrorist financing threats. But the proposed rules that aim to mitigate these risks would likely prevent banks from holding crypto, and as a result would push crypto into unregulated parts of the financial system, the GFMA and five other industry associations told the WSJ. The new rules would require banks to set aside a dollar in capital for every dollar of bitcoin ((BTC-USD -3.8%)) they own, but the GFMA argues that most traded cryptos, including BTC, shouldn't face these strict capital requirements. "We find the proposals in

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