Basel Committee's Outdated Crypto Rules Threaten Digital Asset Adoption

The Basel Committee's cryptoasset standard has been in effect since January 1, 2026, but it still treats Bitcoin as a guaranteed loss. This means that banks are required to hold capital equal to their full exposure, essentially doubling down on the risk.

This is a major issue for banks looking to get into digital assets because it makes them wary of taking on too much crypto-related risk. The standard was created with the intention of preventing banks from importing losses into the deposit base, but it has become outdated as the market evolves.

The Committee has opened an expedited review of targeted parts of the standard and is expected to release an update later this year. This is a positive step towards revising the outdated rules and creating a more risk-sensitive approach.