Payments

The payments landscape for community banks is changing rapidly as traditional payments converge with new instant payment systems and emerging cryptocurrencies. It is critical for Community Banks to maintain awareness of developments in the payments space to assess new opportunities, mitigate risks, and ensure that their payment strategy aligns with overall business plans.

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Basel Committee releases final crypto framework with ICBA-backed exclusion

July 18, 2024

The Basel Committee on Banking Supervision published targeted amendments to its cryptoasset standard to tighten the criteria for certain stablecoins to receive a preferential regulatory treatment, which included an exclusion that ICBA strongly backed.

Details: The committee did not back down from its decision to exclude assets issued on permissionless blockchains from Group 1 treatment, a position ICBA strongly endorsed in a March comment letter. ICBA agreed that the “use of permissionless blockchains gives rise to a number of unique risks, some of which cannot be sufficiently mitigated at present.”

More: The committee also published targeted amendments to its cryptoasset standard to tighten the criteria for certain stablecoins to receive a preferential regulatory treatment. Both standards are to be implemented by Jan. 1, 2026.