The international rules on the management by the banks of their exposures to crypto assets they will come into force in January 2026, one year later than previously expected. It was up to him to decide group made up of central bank governors and head of supervision (GHOS) which refers to Basel Committee. The decision was motivated by the need to ensure that all members fully implement the new rules. The consultation initiated by Ghos himself will continue until the end of this year at the end of which a further review is expected.
What is the Basel Committee
The Basel Committee is the main one reference body globally for prudential regulation of banks and provides a forum for cooperation on banking supervision. Its mandate is to strengthen the regulation, supervision and practices of banks around the world with the aim of improve financial stability. The Committee reports to the Group of Central Bank Governors and gods Heads of Supervision and asks for his support for the most important decisions. The Committee has no formal supranational authority and its decisions have no legal value. Rather, the Committee relies on the commitment of its members to carry out its mandate. The Group of Central Bank Governors and Heads of Supervision is chaired by Tiff Macklem, governor of the Bank of Canada. The Basel Committee is chaired by Pablo Hernandez de Cos, governor of the Bank of Spain.
The objective of the new regulation
The framework of rules aims to preserve stability financial and promote responsible innovation. “The standard, approved by the GHOS in December 2022, provides a robust and prudent global regulatory framework for bank exposures active internationally to cryptoassets that preserves financial stability while promoting responsible innovation, we read in a note from the Bank for International Settlements.
The context of the GHOS
During the meeting the GHOS did the point on the state of implementation of the Basel III reforms pending, which were finalized in 2017. During the meeting it emerged that they were done “good progress in implementation”: Approximately two-thirds of member jurisdictions will have implemented all, or most, of the standards this year, with the remaining jurisdictions planning to do so by next year. GHOS members then unanimously reaffirmed their expectation to implement all aspects of the Basel III framework fully, coherently and as soon as possible but the series of shocks that have hit financial markets in recent years have convinced the group again about the importance of having a prudent global regulatory framework.
