Significant progress has been made by the European Union (EU) in reforming its banking laws, with an emphasis on cryptocurrencies and bitcoin (BTC). EU regulations now require banks to make their cryptocurrency holdings publicly disclosed. This action aims to mitigate any possible risks related to these assets.
European Banks’ Mandatory Disclosure of Cryptocurrency Holdings
Representatives from the European Parliament, the Commission, and the Council of the European Union decided that banks must disclose their cryptocurrency holdings during a meeting. European organizations have acknowledged the need to increase banking industry transparency concerning cryptocurrency assets. As a result, the European Union Commission will have to present a bill that addresses the requirement for banks operating in the 27 EU member states to declare their cryptocurrency holdings.
European entities have mandated a capital requirement for crypto assets and holdings disclosure. This implies that EU banks must keep some cryptocurrencies in their portfolios until the EU Commission submits a specific legislative proposal. Intending to reduce related risks, this requirement guarantees that banks are suitably equipped to manage cryptocurrency assets.
The banking industry’s proposed regulations align with those expected to mandate disclosure requirements for businesses operating within the cryptocurrency ecosystem. Exchanges, brokers, and other cryptocurrency-related platforms must also disclose their holdings. This action aims to establish a unified regulatory structure for the entire sector.
All 27 EU member states recently approved the MiCA law, which mandates banks to disclose their cryptocurrency holdings. This integration with the proposed bill will ensure consistent regulation of the banking industry and cryptocurrency market businesses.
Additional Conventional Banks Are Entering The Bitcoin Ecosystem
Large financial institutions are becoming increasingly involved in cryptocurrency, and the EU intends to enforce that banks disclose their holdings of Bitcoin and other cryptocurrencies. Reputable European banks have started to sell and hold cryptocurrency in the last year, like Santander-owned CACEIS and Crédit Agricole. With the French regulator’s approval, CACEIS has become one of the conventional financial institutions dipping their toes into the Bitcoin ecosystem.
Prominent financial institutions across the globe have begun offering services associated with digital assets in addition to European banks. For example, major players in the Bitcoin space include BNY Mellon, JP Morgan, and Goldman Sachs in the United States, and Banco Santander, BBVA, Société Générale, and BNP Paribas in Europe. This pattern shows how cryptocurrencies are becoming increasingly accepted in the conventional banking industry.
