EU Banks to Require 1,250% Risk-Weighting for Crypto Asset Exposures

– The European Parliament’s Economic and Monetary Affairs Committee has voted in favor of stricter new requirements for banks dealing with crypto and digital assets.
– The proposed amendment states that banks must apply a risk-weighting of 1,250% to crypto-asset exposures.
– The new rules will need approval from the European Parliament and the EU Finance Ministers for this measure to become law.

The European Union is taking steps to ensure the safety and security of digital assets and crypto investments. The European Parliament’s Economic and Monetary Affairs Committee recently voted in favor of stricter new requirements for banks dealing with crypto and digital assets. The proposed amendment states that banks must apply a risk-weighting of 1,250% to crypto-asset exposures. This measure was taken to limit the number of unbacked loans with Bitcoin (BTC) and Ethereum (ETH) that lenders could hold in front of the European Commission.

The amendment will also bring the other outstanding components of the Basel III International Regulatory Framework into effect. Basel III is an internationally agreed set of measures developed by the Basel Committee on Banking Supervision. The Basel III component would strengthen the financial framework by agreeing to solid capital requirements. This would include a requirement for the banks to disclose if and how they are exposed to cryptocurrencies.

Cross-party compromises will require banks to hold more capital to protect customers against crypto losses. The new rules will need approval from the European Parliament and the EU Finance Ministers for this measure to become law. This will ensure that banks are able to protect customers from any losses that may occur as a result of investing in crypto and digital assets. The aim is to protect customers from any financial losses and ensure that banks are able to provide a safe and secure environment for customers to invest their money.

These new regulations are an important step in ensuring the security and safety of digital assets and crypto investments. The European Union is committed to ensuring that customers are able to make informed decisions when investing in digital assets. This measure will ensure that banks are able to provide a safe and secure environment for customers to invest their money. It will also ensure that customers are protected from any potential losses that may occur due to investing in crypto and digital assets.