The Basel Committee’s strict capital rules currently impose a prohibitive 1,250% risk weight on Bitcoin. Market analysts argue this effectively prevents banks from holding the asset. An upcoming update to these international banking regulations in 2026 could lower that risk rating.
The international Basel III rules governing bank capital requirements are due for an update in 2026. Market analyst Nic Puckrin stated that if Bitcoin receives a lower risk rating in the revised rules, it could potentially trigger a significant influx of liquidity. Under the current framework, BTC and similar digital assets carry a 1,250% risk weight.
This means banks must hold reserve assets at a 1:1 ratio to back any Bitcoin on their balance sheets. “The Fed just announced a proposal on how these rules will be implemented in the US, with a 90-day public comment window,” Puckrin said. “If BTC’s treatment improves even slightly, it could open the door for banks to finally integrate BTC into the financial system.”
The Basel Committee on Banking Supervision (BCBS) proposed these stringent capital requirements for cryptocurrencies in 2021. They placed crypto in the highest risk category. In February, several crypto treasury company executives called for reform to implement more accommodating risk weights.
Jeff Walton, chief risk officer at Bitcoin treasury company Strive, compared the risk weights across asset classes. He stated that investment-grade corporate bonds carry a risk weight of up to 75%, while gold, government bonds and physical cash have a 0% weight. Walton concluded that “risk is mispriced.”
Chris Perkins, president of investment company CoinFund, described the Basel capital requirements as a covert form of choking off the crypto industry. “It’s a very nuanced way of suppressing activity by making it so expensive for the bank to do those activities,” Perkins told Cointelegraph.
