The push to hasten the implementation of crypto rules and regulations is spreading around the world, with the EU leading the way.
The EU is working hard to impose stringent capital requirements on banks that handle crypto assets.
A January 2025 deadline has been set by the worldwide Basel Committee of banking regulators from the world’s biggest financial centres. The regulations govern the capital requirements for banks with exposure to cryptocurrencies and stablecoins.
According to a Reuters story published on February 20th, the European Commission claimed that for the time being, banks have extremely minimal crypto-asset exposures and only a limited engagement in delivering crypto-asset-related services, before adding:
“Banks have expressed interest in trading crypto-assets on behalf of their clients and to provide crypto-assets-related services.”
Crypto banking regulations coming
A hiccup in the regulatory rollout could result in delays for banks eager to enter the crypto sector. According to the source, the EU might either propose a new law or expand the banking regulation it is currently negotiating.
The European Parliament and EU Member States have equal say in the new banking regulation, according to an informal discussion document. They are about to start talks that could encompass crypto assets.
This would provide banks with better clarity about crypto assets and their capital requirements in order to minimize customer risks. A separate draft law, on the other hand, would not be available until at least the end of 2023.
The EU is planning to launch an all-encompassing crypto framework called MiCA (Markets in Crypto Assets), but this is unlikely to happen until 2024.
MiCA has been chastised for eroding privacy by requiring crypto exchanges and wallets to share information with its consumers in order to combat tax evasion and money laundering.
Market Prospects
Bitcoin markets have resumed their upward trend, gaining 2.8% on the day. This has raised overall capitalization to $1.19 trillion at the time of writing.
The market has risen 44% from the beginning of the year to a six-month high. According to CoinGecko, Bitcoin is leading gains with a 3% increase to trade at a little under $25,000 at the time of writing.
Meanwhile, Ethereum has surpassed $1,700, up 2.3% on the day. Some altcoins that are doing well right now include Ripple (XRP), Avalanche (AVAX), and Uniswap (UNI).
