BIS starts consultation on regulating banks' exposure to cryptoassets
The world's watchdog for central banks began a public consultation on Thursday on preliminar proposals for how lenders' exposure to cryptocurrencies should be regulated.
"While banks' exposures to cryptoassets are currently limited, the continued growth and innovation in cryptoassets and related services, coupled with the heightened interest of some banks, could increase global financial stability concerns and risks to the banking system in the absence of a specified prudential treatment," the Bank of International Settlements said in a statement.
Proposed regulation divided cryptoassets into two groups.
A first group was eligible for treatment under the existing regulatory framework and included "certain tokenised traditional assets and stable coins".
However, of the second group, which included the likes of Bitcoin, BIS said that they "pose additional and higher risks, [so] they would be subject to a new conservative prudential treatment."
The consultation period was due to end on 10 September, but BIS added that more consultations were likely given the "rapidly evolving nature of this asset class".