In the latest report published by the Basel Committee of Banking Supervision (BCBS) of the Bank for International Settlements, known for its distant approach to crypto money markets, an opinion was presented that banks can hold cryptocurrencies up to 1 percent of their reserves.
In the Basel Committee of Banking Supervision (BCBS) report, cryptoassets were divided into two groups based on the condition of meeting certain criteria. The report recommended that banks invest in crypto assets that fall under the group 2 category, not exceeding 1 percent of the bank's reserve.
According to the criteria set by Basel Committee of Banking Supervision (BCBS), assets in the group 2 category consist of standard cryptocurrencies, stablecoins and tokenized traditional assets that do not meet certain criteria. On the other hand, group 1 category consists of fixed crypto assets and tokenized traditional assets that meet the specified conditions.
The institution, which sets international standards for banks, has determined the standards regarding the rate of investment in cryptocurrencies, which are defined as high-risk assets, with this report. The institution also stated that the suggested rates and categorization criteria may be updated depending on possible developments.
On the other hand, the 1 percent limit set by the Bank for International Settlements could potentially reach billions of dollars given the reserves of global banking giants.
The Basel Banking Supervision Committee of the Bank for International Settlements has been interpreted as softening its stance, although it has been cautious towards crypto assets compared to previous reports, with its latest report.
The Bank for International Settlements has made it clear that it has a dubious approach to cryptocurrencies with its comments in the past. In a recent BIS bulletin, it was stated that crypto-assets will never be able to qualify as money and will constantly face problems such as high fees and network congestion.