Trending Topic: EU Lawmakers Impose Strict Rules On Banks Holding Cryptocurrencies

Banks could be required to hold a “risk-weighted exposure amount” of up to 1,250% of capital based on exposure to crypto if the full parliament passes the measures.

European Union lawmakers have imposed strict measures for banks holding digital assets in a bid to limit the amount of unregulated cryptocurrency that banks can hold. 

A draft law expected to be voted on by the European Parliament's economic affairs committee on Tuesday stated banks would have to set aside a significant amount of capital to cover their crypto asset holdings. What Happened: This was part of the Basel III accord, which required banks to hold more capital to cope with market shocks without the need for taxpayer aid, Reuters reported.

European Union lawmakers have agreed to several changes, including stricter new requirements for banks dealing with crypto and digital assets. The European Parliament's Economic and Monetary Affairs Committee has voted on the matter that will put these restrictions in place.

Key Points: Following a vote in a committee of the European Parliament on Tuesday, MPs agreed that banks holding cryptocurrency must adhere to severe legislation to maintain capital needs.

On Tuesday, European lawmakers gave a mandate requiring banks holding cryptocurrencies to abide by more stringent measures. The Parliament's Economic and Monetary Affairs Committee enforced increased capital requirements for any institution possessing digital assets.