The European Banking Authority (EBA) published a Consultation Paper on its draft Regulatory Technical Standards (RTS) to specify the technical elements necessary for institutions to calculate and aggregate crypto-asset exposures in relation to the prudential treatment of such exposures. „These RTS will address implementation aspects and ensure harmonisation of the capital requirements on crypto-assets exposures by institutions across the EU.” – according to the press release.
Considering the rapidly evolving crypto-market, the Capital Requirements Regulation (CRR 3) introduced a transitional prudential framework for institutions holding crypto-assets exposures. The provisions consider the legal requirements introduced in the Markets in Crypto Assets Regulation (MiCAR) and specify, amongst others, the capital treatment of exposures to electronic money tokens (‘EMTs’), asset reference tokens (‘ARTs’) that reference one or more traditional asset(s) and ‘other’ crypto-assets – including for example ARTs referencing a crypto-asset – and – unbacked crypto-assets, such as Bitcoin.
These draft RTS further develop the relevant capital treatment for credit risk, counterparty credit risk (‘CCR’), market risk (‘MR’) and credit valuation adjustment risk for ‘ARTs’ and ‘other’ crypto-assets exposures and align, to the extent possible, the capital treatment with the elements specified in the Basel standard on prudential treatment of crypto-asset exposures.
These draft RTS also include all the relevant technical elements on the use of netting, aggregating of long and short positions, criteria to allow hedge recognition for other crypto-assets, and the underlying formulas relevant for calculating the exposure value of crypto-assets for the CCR and MR treatment.
In addition, these draft RTS propose that all fair valued crypto assets within the scope of MiCAR under the applicable accounting framework shall be subject to the requirements for prudent valuation under the CRR 3.
Transitional provisions in the CRR 3 together with the rules set out in these draft RTS enable institutions to adequately capitalise their crypto-asset exposures until a permanent prudential treatment comes into force.
Comments to the consultation paper can be sent by clicking on the „send your comments” button on the EBA’s consultation page. The deadline for the submission of comments is 8 April 2025.
The EBA will hold a virtual public hearing on 4 March 2025 from 10:00 to 12:00 CET. The EBA invites interested stakeholders to register using this link by 28 February 2025 at 16:00 CET. The dial-in details will be communicated to those who have registered for the meeting.
All contributions received will be published following the end of the consultation, unless requested otherwise.
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
