EU mandates banks to hold euro equivalent of crypto investments

EU lawmakers passed a law Jan. 24 that mandates banks invested in crypto to hold the euro equivalent of their crypto investments as capital, Reuters reported.
The requirement will come into force in January 2025 to give banks enough time to adjust their finances, according to Reuters. The bill was approved with the purpose of eliminating the instability within the crypto sphere.
EU Parliamentarian Markus Ferber said:

“Banks will be required to hold a euro of their own capital for every euro they hold in crypto. Such prohibitive capital requirements will help prevent instability in the crypto world from spilling over into the financial system,”

According to the Association for Financial Markets in Europe (AFME), the new bill does not have a clear definition of what a crypto asset is. Therefore, it could be applied to tokenized securities as well.
Since all EU states have approved the bill, lawmakers will start negotiating the final text with member states to finalize the official script.

Journalist at CryptoSlate
Zeynep is an academic who turned to crypto in 2018. Originating in social sciences, she is especially interested in the social impact of blockchain and cryptocurrencies and strongly believes in their transmuting power.

Connect your wallet, trade with Orion Swap Widget.
Directly from this Widget: the top CEXs + DEXs aggregated through Orion. No account, global access.

Recent EU Stories

Disclaimer: Our writers’ opinions are solely their own and do not reflect the opinion of CryptoSlate. None of the information you read on CryptoSlate should be taken as investment advice, nor does CryptoSlate endorse any project that may be mentioned or linked to in this article. Buying and trading cryptocurrencies should be considered a high-risk activity. Please do your own due diligence before taking any action related to content within this article. Finally, CryptoSlate takes no responsibility should you lose money trading cryptocurrencies.

This article has been originally published at: