HomeNewsGlobal Banking Regulators Set New Framework for Cryptocurrency Services

Global Banking Regulators Set New Framework for Cryptocurrency Services

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  • The Basel Committee’s new regulatory framework for banks dealing with cryptocurrencies will take effect in January 2026.
  • Major Latin American banks, including Nubank, must align with this framework to continue offering cryptocurrency services.

In an era increasingly influenced by digital currencies, the Basel Committee on Banking Supervision has approved a definitive regulatory framework designed to govern traditional banks’ involvement in the cryptocurrency market. This pivotal move, announced after meetings held on July 2 and 3, 2024, aims to usher in a new age of transparency and market discipline within the financial sector.

Navigating New Norms

The framework, which will be officially published at the end of July and come into force on January 1, 2026, introduces a standardized set of public tables and templates. These tools are intended to delineate the extent of banks’ engagement with cryptocurrencies, enhancing the availability of information and supporting market discipline. This structured approach reflects the Committee’s goal to foster a coherent understanding of the evolving digital asset landscape.

Further refining the oversight of crypto-assets, the Basel Committee has specifically addressed stablecoins such as USD Tether (USDT) and USD Coin (USDC). These assets are slated to receive a regulatory preference within Group 1b, implying stricter criteria they must satisfy to be recognized as low-risk assets. This categorization aims to differentiate reliable and well-supported stable cryptocurrencies from those posing potential risks to the financial system.

The revised standards will also clarify the position of traditional banks as potential issuers of tokenized deposits and stablecoins. The risk posed by these products to financial stability is partially dependent on their specific structures and the legal frameworks of their jurisdictions. The Committee has indicated that these risks are substantially covered in the current framework, which will continue to be monitored and adapted in response to market developments.

Immediate Implications for Banks

While the regulations will not be enforceable until 2026, banks are now tasked with preparing to comply. Institutions within the cryptocurrency ecosystem, such as Nubank, one of Latin America’s largest banks, will need to adapt to avoid potential enforcement actions, which could include restrictions, license revocations, fines, and increased capital costs.

Nubank, which has been providing services for the purchase, sale, transmission, and receipt of Bitcoin (BTC) and other cryptocurrencies to customers in Brazil, Mexico, and Colombia since 2022, will have to ensure its operations align with the new framework. This situation is similar for other banks in the region that have exposed themselves to crypto-assets, like TowerBank in Panama and Itaú Unibanco in Brazil, which have recently begun offering similar services.

The Basel Committee’s regulations represent a significant step toward integrating traditional financial operations with the burgeoning field of digital currencies, setting a global standard that ensures both stability and innovation within the financial sector.

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Nikita Dmitrievich
Nikita Dmitrievichhttps://www.ethnews.com/
Nikita, a young and ambitious crypto investor who has been actively involved in the cryptocurrency world for the past 6 years. With a keen interest in blockchain technology, Nikita has been investing in various cryptocurrencies and has seen significant returns on his investments. He is passionate about educating others on the potential of cryptocurrencies and frequently shares his insights on social media platforms. Nikita believes that cryptocurrencies are the future of finance and is constantly researching new projects to invest in. With his dedication and knowledge, Nikita is quickly becoming a prominent figure in the crypto community. Business Email: [email protected] Phone: +49 160 92211628