BIS Warns Crypto Giants Now Act Like Banks — Without the Rulebook
The BIS warns that major crypto platforms function like unregulated banks, creating significant shadow banking risks that require stricter financial oversight.Summary
The Bank for International Settlements (BIS) has identified that large crypto service providers, termed "multifunction cryptoasset intermediaries," are performing functions similar to banks and prime brokers without adhering to standard prudential regulations. By managing deposit-like assets and engaging in activities such as margin lending, these firms create risks related to maturity and liquidity transformation, mirroring traditional shadow banking concerns. The report highlights that the absence of deposit insurance, coupled with poor transparency and interconnectedness, makes the sector vulnerable to systemic failures, as seen in previous market collapses. To mitigate these risks, the BIS recommends implementing comprehensive, activity-based regulatory frameworks that include requirements for capital, liquidity, governance, and stress testing.
(Source：BeInCrypto)