Monetary authorities are calling for a review of Bitcoin's weights in the Basel III framework

Cryptocurrency leaders and financial analysts worldwide are calling on international banking regulators to reconsider their approach to assessing digital asset risks. The focus is on the risk weight system implemented by the Basel Committee on Banking Supervision (BCBS), which imposes significant restrictions on banks seeking to expand their cryptocurrency operations.

Disproportion in risk weights: why 1,250% seems unfair

Current Basel III regulations assign the highest risk weight of 1,250% to cryptocurrencies, including Bitcoin. In comparison, cash, physical gold, and government bonds have a risk weight of 0%. This means banks must hold reserves equal to 1:1 for each Bitcoin in their portfolios, making such investments economically unviable compared to traditional assets.

Jeff Walton, Chief Risk Officer at Strive, expressed well-founded criticism of this approach. According to him, if the US aims to take a leadership position in the global crypto market, banking regulation must adapt to the realities of the digital economy. He believes the current system unjustifiably inflates the perceived risk associated with digital assets.

How capital requirements affect bank profitability

High collateral requirements for cryptocurrencies create serious obstacles for banking activity. Chris Perkins, President of investment firm CoinFund, emphasized that bank capitalization is a key indicator of their financial stability and profitability. When banks are forced to allocate excessive reserves for holding digital assets, it directly reduces their operational efficiency.

Perkins drew an interesting analogy, calling the current situation “Operation Chokepoint 2.0”—a sophisticated method of restricting banks’ involvement in crypto operations. Unlike direct de-banking, this approach makes participation too costly for financial institutions without explicitly banning it.

Evolution of regulators’ stance: from criticism to considering reforms

The history of Basel III’s risk weight requirements for cryptocurrencies began in 2021, when the committee proposed classifying digital assets in the highest risk category. These requirements were officially finalized and implemented in 2024, sparking industry criticism.

Fong Lee, CEO of Strategy, one of the largest Bitcoin reserve management companies, has become a vocal advocate for reforming the weight system. His position reflects the widely held view that the current approach does not accurately represent the actual risk profile of digital assets.

Possible prospects: a shift in 2025-2026

Trends are changing. In October 2025, reports indicated that BCBS was considering easing capital requirements for digital assets. This shift was partly driven by the exponential growth of the stablecoin market, whose capitalization approaches $300 billion (according to RWA.xyz).

In November 2025, Erik Tedein, head of the Basel Committee, suggested that the international banking regulator might need an “alternative approach” to setting weights for cryptocurrencies. This hints at potential modifications to the collateral system and a reassessment of risk. Such statements indicate that the debate over the fairness of risk weights in the Basel III system is gaining importance at the highest levels of global regulatory authorities.