Financial institutions urge for change in crypto regulations
According to Bloomberg, strong institutional groups are pressuring the Securities and Exchange Commission to modify accounting guidelines in a way that increases the cost of US banks holding digital assets on behalf of their clients. The coalition of trade associations, comprising the American Bankers Association, the Securities Industry and Financial Markets Association, the Financial Services Forum, the Bank Policy Institute, and others, wrote the SEC a letter on Wednesday requesting several adjustments.
This urge for crypto regulation change comes at a time when prices for Bitcoin and the demand for Bitcoin ETFs have skyrocketed in the past few days.
Current rules prohibit banks from offering Bitcoin ETFs
At present, public corporations, including banks, are required under the current guidance to record the cryptocurrency they own as liabilities on their corporate balance sheets. This implies that for banks to meet their capital requirements, they must set aside assets of a comparable value as a loss-avoidance measure. The rule comes at a setback in the present times, as this prohibits banks and other regulated institutions from offering Bitcoin ETFs, NFTs, etc.
The current changes in the rules additionally requested excluding specific assets from the definition of cryptocurrency as a whole. This covers any tokens supporting SEC-approved products, such as spot-Bitcoin exchange-traded funds, as well as any traditional assets recorded or transferred utilizing blockchain networks, such as tokenized deposits. The letter also demands to preserve the requirement that businesses reveal their cryptocurrency activity in financial statements while exempting licensed lenders from the present balance sheet requirement.
Bitcoin prices today
The demand by various institutional banks shows the constant surge in the demand for crypto assets. The demand also comes at a time when the prices for the OG-crypto currency have ascended steadily, after previously being rangebound. The Bitcoin price has crossed the $52,000 mark recently, reflecting strong market confidence towards the flagship crypto. As of writing, the Bitcoin price was trading at $$51,,646, being up nearly 1% in the past 24 hours. The market cap of BTC has also hit the $1 trillion mark again. Additionally, this demonstrates the improvement in investor confidence and the sharp rise in Bitcoin appetite.
Source:coingape.com
