Senate Republicans urged financial regulators to rework bank capital rules for digital assets

Summary

Regulators should work on a fresh capital framework for digital assets, they said in a letter sent last week to Federal Reserve Vice Chair of Supervision Michelle Bowman, Federal Deposit Insurance Corporation Chair Travis Hill, and Comptroller of the Currency Jonathan Gould. The lawmakers criticized standards from the international Basel Committee on Bank Supervision, published over the years, that assigned a " 1,250% risk weight " on digital assets. Part of the Bank for International Settlements, the Basel Committee is a global standard-setting body composed of 45 central banks and banking supervisors, including U.S. regulators. "Any proposed capital treatment of on-balance sheet digital asset activities should accurately reflect the opportunities and risks of digital assets—and be based on, to the extent possible, a technology-neutral approach that gives banks the authority to participate meaningfully in digital asset markets," the lawmakers said in the letter. Lummis, Dan Sullivan, Bill Hagerty, Bernie Moreno, Ted Budd, and Jon Husted signed the letter.