Global Regulators Reevaluate Crypto Banking Rules Amid Stablecoin Growth

Global regulators are taking a fresh look at banking rules governing crypto assets, with a particular focus on stablecoins, as the digital asset market continues to evolve rapidly. This review comes amid growing pressure from major economies and industry groups to overhaul stringent capital requirements that are set to take effect in 2026, according to CryptoNews.

Understanding Basel’s Current Framework

The Basel Committee on Banking Supervision (BCBS), recognized as the leading authority on global banking standards, is considering amendments to its 2022 framework. This framework imposed some of the strictest capital rules for crypto holdings, requiring banks to assign a 1,250% risk weight to unbacked crypto assets, such as Bitcoin (BTC). These measures, while designed to protect banks from potential losses, have discouraged many institutions from engaging in crypto-related services.

Stablecoins, which are digital tokens pegged to assets like the U.S. dollar, have seen rapid growth and are now at the center of regulatory debates. Despite their stability, current Basel rules subject them to the same heavy capital requirements as volatile cryptocurrencies, leading to calls for revision.

Calls for Regulatory Revisions

The United States is leading the push for updates, arguing that the original Basel standards are outdated in today’s dynamic crypto market. The U.S. GENIUS Act is one example of new regulatory frameworks encouraging the use of stablecoins for payments. However, regulatory inconsistencies remain, as permissionless stablecoins like Tether (USDT) and Circle’s USDC face the same capital charges as more volatile digital currencies.

In Europe, regulators are incorporating Basel standards into their own frameworks, with transitional rules allowing limited engagement with digital assets while more permanent solutions are developed. The European Central Bank supports implementing existing rules first, while the U.S. and other regions are seeking revisions before these standards become mandatory.

Global Divergence and Future Outlook

While Basel Committee guidelines are non-binding, member jurisdictions typically adopt them. However, timelines vary, with Singapore delaying its implementation to ensure global alignment, and Hong Kong planning to introduce lighter requirements for licensed stablecoins in 2026.

The debate over crypto banking rules is intensifying as industry groups urge the Basel Committee to ease the capital burden on banks. These discussions are crucial as stablecoins could significantly impact global finance, with some reports predicting a potential $1 trillion shift from traditional banks to stablecoins by 2028.

As regulators and industry stakeholders continue to negotiate, the evolution of these rules will likely shape the future landscape of digital asset services in the banking sector.

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