Go Back

Update on crypto-asset regulation

Update on crypto-asset regulation

Madrid, 1 February 2023 – Below you will find a summary of the state of regulation around cryptoassets:

  • FSB Consultation Process: the consultative process followed by associations such as GFMA-AFME and the IIF was concluded. This consultation aims to seek global standards for application in the different global jurisdictions and to begin to treat cryptoassets as a consolidated and mature industry (control principles and procedures very similar to those applied in banking, which positions banks as potential bridges between traditional finance and the crypto world).

Two consultations have been published simultaneously:

1) Global Stablecoins (or GSC): to adjust the existing framework. The aim is to differentiate stablecoins from other cryptoassets due to their potential systemic impact. In the case of an asset becoming a GSC, it has to comply with reporting criteria and controls similar to those of a mature industry.

2) Crypto-assets: to define a new framework including DeFi, given that it is not covered by MiCA. This is a phenomenon that is not yet widely adopted and does not yet need to be regulated as a matter of urgency.

Recommendations will be updated and implemented over the next 6 months.

  • MiCA: its vote in the European Parliament and subsequent publication in the journal of sessions has been delayed due to translation and linguistic checks. Of note is the large number of Regulatory Technical Standards (RTS) that EBA/ESMA have to develop. EBA has started work, in particular on the RTS with the information to be submitted for ART issuance and another RTS with the information to be submitted for the acquisition of significant shareholdings for an ART issuer (required for acquisitions above 10% and additional percentages).
  • BIS. Prudential treatment (For banks only).

1) Final framework. Entry into force is scheduled for 1 January 2025. The changes with respect to the original proposal stand out:

-Infrastructure add-on eliminated (set at 0% with possibility of increase).

-Group 1b: redemption test eliminated.

-Group 1b: supervised and regulated issuer required, not necessarily a bank, but with capital and liquidity requirements.

-Group 2: The limit of 1% of tier 1 was strict, based on the sum of the short and long position, and now it is scaled and works in two stages: the largest position is taken between the short and long position (to avoid discouraging hedging) and now only the excess of 1% goes to 1,250%, and from 2% onwards, all the rest with the same capital charge.

-Classification, permission is no longer required, although the supervisor will have the right to request modification.

-Pre-approval has been eliminated but the supervisor’s ability to do an over-ride is maintained. Harmonisation in rating is pursued.


2) Future work. Follow-Up for 2023

-Statistical tests to classify as group 1.

-Reserve assets.

-Unpermitted networks and punishment of network use (goes directly to group 2).

-Tracking of assets used as collateral.

-Thresholds set for group 2 will be monitored.

-Reassess the adequacy of the calibration of the threshold.