Wall Street Demands Basel Crypto Overhaul: ’Outdated Rules Threaten Financial Innovation’
Wall Street's biggest trade associations are throwing down the gauntlet against proposed Basel crypto capital requirements—calling the standards archaic and fundamentally misaligned with how digital assets actually behave.
Risk models stuck in the past
They argue the current framework treats crypto like toxic waste—demanding banks hold capital reserves that make holding Bitcoin nearly impossible from a balance sheet perspective. One banking exec quipped, 'They’re regulating like it’s 2008 and we’re still worried about mortgage-backed securities.'
Innovation at a standstill
Strict capital charges have effectively frozen major institutions out of crypto markets—forcing them to watch from the sidelines as private funds and offshore entities capture the upside. 'We’re handing the future of finance to unregulated players because our rulebook is gathering dust,' noted a lobbyist familiar with the push.
Basel’s blind spot
The groups claim regulators are applying industrial-era risk weights to internet-native assets—a mismatch that could push banking further into irrelevance. Because nothing says 'forward-thinking' like requiring 100% capital reserves for something that settles in seconds and self-custodies.
Watch for more institutions to join the rebellion—nobody likes leaving money on the table while hedge funds and crypto natives eat their lunch. Even in regulated finance, greed eventually talks louder than compliance.
