According to research conducted by the Basel Committee on Banking Supervision, the biggest banks in the world are exposed to crypto assets worth roughly 9.4 billion euros ($9 billion). The exposure consists mainly of client services that involve bitcoin (BTC) and ether (ETH), and it accounts for 0.14% of the total risk exposure from the 19 banks that submitted data. This amounts to only 0.01% across all banks.
The Basel Committee- an organisation of national regulators that establishes safety standards for banks to prevent financial crises similar to the one that occurred in 2008- is now thinking about new regulations on the collateral that lenders are required to retain against innovative assets. The study in question- as the very first of its kind- is expected to have a significant influence on the policy.
The research, written by Renzo Corrias of the Basel Committee’s Secretariat, stated that the template that was given to the banks was expressly made to support the Committee’s two consultative papers on the prudential management of banks’ exposures to crypto assets, which were released respectively on June 10, 2021 and June 30, 2022.
The Basel Committee outlined rough guidelines for how banks could enter the cryptocurrency market in the two aforementioned documents. Since only a handful of banks participated in this survey, however, the study warns that the results may not present a completely accurate picture. As Corrias states, “While they are helpful in providing a broad indication of banks’ crypto asset activity, they should be interpreted with a degree of caution”.