BPI submitted a comment letter to the Basel Committee on Banking Supervision in response to the BCBS’s consultation on the prudential treatment of cryptoasset exposures. In its letter BPI recommended that:
- Any final framework be flexible in order to accommodate the rapid evolution of this area, promote a level playing field, and avoid regulatory fragmentation;
- The classification framework should be more risk sensitive and more appropriately tailored to the characteristics of cryptoassets; and
- The proposed application of a 1250% risk-weight to “group 2” cryptoassets is reactionary, fails to account for the impact of buffers, and ignores the existing separate treatment for banking book and trading book exposures.
Click on the download button below to access the comment letter.