The Basel Committee has laid out guidelines for banks that plan to enter the cryptocurrency market. While outlining the supposed threats posed by crypto assets in terms of financial stability, the committee has said it expects banks that are going to have direct exposure to the crypto industry to be prudent in their approach. As a minimum requirement, banks should improve their risk management and disclosure processes to reduce risk, it recommended.
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‘Improve Risk Management and Disclosure Processes’
Housed under the Bank for International Settlements, the Basel Committee is a conglomerate of banking supervisory authorities that was established by the central bank governors of the Group of Ten countries in 1974. Its objective is to enhance understanding of key supervisory issues and improve the quality of banking supervision worldwide.
In a statement released on March 13, the global banking watchdog encouraged banks to…