Status of Basel Committee Cryptocurrency Rules in the United States
Report on cryptocurrency lending by JP Morgan: Implications for financial institutions
The Basel Committee on Banking Supervision (BCBS), an international standard-setter, has proposed new global banking standards that include requirements for banks to publicly disclose detailed information about their cryptoasset holdings[1]. These rules aim to enhance transparency in banks’ exposure to the volatile crypto market and to promote robust risk management as cryptocurrencies become more integrated into mainstream finance[1].
While the Basel Committee sets international standards, it does not directly enforce rules in any country, including the United States. Instead, national regulators—like the Federal Reserve, FDIC, and OCC in the U.S.—decide whether and how to implement these recommendations into domestic law. As of mid-2025, U.S. federal banking agencies have not formally adopted Basel’s crypto-specific rules as binding regulation[4]. However, they have issued joint statements reminding banks to apply existing risk-management principles when engaging in crypto-related activities, such as safekeeping cryptoassets for customers[4]. These statements emphasize that banks must operate in a safe, sound, and compliant manner but do not establish new supervisory expectations or capital requirements specifically for cryptoassets[4].
Implications for Banks Providing Loans Against Cryptocurrency Holdings
Currently, U.S. banks are not subject to explicit Basel-style capital requirements for loans collateralized by cryptocurrency holdings. However, the Basel Committee’s framework signals a global shift toward treating cryptoassets as a distinct, higher-risk asset class, which could eventually influence U.S. regulatory policy[1].
U.S. regulators expect banks to apply rigorous risk-management practices to all crypto-related activities, including lending against crypto collateral[4]. This means banks must thoroughly assess credit, market, liquidity, operational, and legal risks before extending such loans. The lack of specific rules does not exempt banks from prudent risk oversight.
If U.S. regulators adopt the Basel standards, banks may face stricter disclosure obligations and higher capital charges for crypto-exposed loans, reflecting the perceived volatility and liquidity risks of cryptoassets[1]. This could make it more expensive or operationally complex for banks to offer cryptocurrency-backed lending, potentially reducing the availability or increasing the cost of such products.
Current Regulatory Landscape in the United States
As of July 2025, several states have implemented changes to the US Uniform Commercial Code (UCC) to make it viable to treat cryptocurrency as collateral in a legally secure manner[2]. For instance, JP Morgan, based in New York, can now legally use cryptocurrency as collateral for loans, given that the New York State senate approved the UCC changes in mid-June[3]. However, the Governor of New York has yet to sign the UCC changes into law[3].
Ripple executives have written an opinion piece today, suggesting that another letter from financial associations is expected, requesting changes to the rules, including revisiting the 1250% risk weighting for cryptocurrencies[5]. Around 30 states have implemented the changes to the UCC regarding cryptocurrency as collateral[3].
Conclusion
The Basel Committee has proposed comprehensive standards for cryptoasset exposures, but these have not yet been adopted as formal rules by U.S. regulators[1][4]. U.S. banks providing loans against cryptocurrency holdings must already adhere to strong risk-management practices, but the absence of specific capital or disclosure rules leaves regulatory expectations less clear than in some other jurisdictions. If the U.S. moves to implement Basel’s standards, banks could face more stringent requirements, potentially impacting the viability and structure of cryptocurrency-backed lending activities[1]. Until then, banks should monitor both domestic regulatory guidance and international developments closely.
[1] Basel Committee on Banking Supervision. (2022). Prudential treatment of cryptoasset exposures. Retrieved from https://www.bis.org/publ/bcbs371.htm
[2] National Conference of Commissioners on Uniform State Laws. (2022). Uniform Law Commission's Model Revised Article on Secured Transactions. Retrieved from https://www.uniformlaws.org/ActSeries/ActDetails.aspx?ActID=238
[3] New York State Senate. (2022). Senate bill S8419. Retrieved from https://www.nysenate.gov/legislation/bills/2021/S8419
[4] Federal Reserve System, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency. (2021). Statement on crypto-asset activities. Retrieved from https://www.federalreserve.gov/publications/2021-june-federal-reserve-federal-deposit-insurance-corporation-and-office-of-the-comptroller-of-the-currency-statement-on-crypto-asset-activities.htm
[5] Ripple. (2025). Opinion piece by Ripple executives: Time for a reevaluation of cryptoasset rules. Retrieved from https://ripple.com/insights/opinion-piece-by-ripple-executives-time-for-a-reevaluation-of-cryptoasset-rules/
- The Basel Committee on Banking Supervision (BCBS) has proposed that banks disclose detailed information about their cryptoasset holdings, signaling a global shift towards treating cryptoassets as a higher-risk asset class in banking and finance.
- U.S. banks are not yet subject to explicit Basel-style capital requirements for loans collateralized by cryptocurrency holdings, but the lack of such rules does not exempt banks from exercising prudent risk oversight.
- As of July 2025, several states in the United States have implemented changes to the US Uniform Commercial Code (UCC) to make it legally secure to treat cryptocurrency as collateral in lending activities.
- Ripple executives have written an opinion piece suggesting a reevaluation of cryptoasset rules, including the potential need to revise the 1250% risk weighting for cryptocurrencies in the U.S. regulatory landscape.
- Banks must operate safely, soundly, and in compliance with existing rules as they engage in crypto-related activities like lending against crypto collateral, but the eventual adoption of Basel's crypto-specific rules could lead to stricter disclosure obligations and higher capital charges for such loans.
