EU lawmakers vote for stricter regulations on banks holding cryptocurrencies

The European Parliament announced that the Commission has voted overwhelmingly in favor of amending its Capital Requirements Regulation and Capital Requirements Directive applicable to banks holding cryptocurrencies. Banks will be required to hold a “risk-weighted exposure amount” of up to 1,250% of capital based on their exposure to cryptocurrencies, according to a draft law.

The legislator said the changes were consistent with those at the Basel Committee on Banking Supervision (BCBS), which is responsible for international banking standards. The group published consultation papers in 2019, 2021 and 2022 that explored grouping crypto assets and recommended how banks should respond to potential risks. BCBS reports that banks’ exposure to crypto assets exceeded $9 billion as of 2021.