EU crypto ban

The EU hopes it can impose restrictions on banks holding cryptocurrencies.

European legislatorsUnion voted for a bill thatimposes prohibitive capital requirements on banks holding crypto assets, citing the need for stricter regulations, as evidenced by the chaos in the industry over the past few months.

The bill reflects the policy proposedThe Basel Committee of the Bank for International Settlements, according to which unsecured crypto holdings will be assigned to the highest possible level of risk, and for banks holding unsecured cryptocurrencies, a capital limit of 2% will be set.

“Banks will have to hold euros of their owncapital for every euro they hold in cryptocurrency. Such prohibitive capital requirements will help prevent the volatility in the world of cryptocurrencies from spreading to the financial system,” Markus Ferber, center-right representative of the European Parliament, said in a statement.

The bill is expected to be implemented in 2 years (in January 2025) if the European Parliament approves the final version.

The Financial Markets Association of Europe said the proposal does not define crypto assets and therefore could also apply to tokenized securities.