Basel reform may channel fresh bank capital into Bitcoin, analyst

The Basel III rules, set to be updated in 2026, could trigger a "huge" influx of liquidity into Bitcoin if the asset receives a lower risk rating, market analyst Nic Puckrin said. Under current Basel rules, BTC and similar digital assets carry a 1,250% risk weight, which requires banks to hold reserve assets at a 1:1 ratio to back any Bitcoin on their balance sheets.

Puckrin said these restrictive capital requirements make it "almost impossible" for banks to hold BTC or offer BTC-related services. He added: "The Fed just announced a proposal on how these rules will be implemented in the US, with a 90-day public comment window.

If BTC’s treatment improves even slightly, it could open the door for banks to finally integrate BTC into the financial system." The Basel Committee on Banking Supervision proposed the current capital requirements in 2021, placing crypto in the highest risk category.

United States

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