Home > NEWS > Crypto distribution is uneven among banks as prudential exposure rises: BIS report

Crypto distribution is uneven among banks as prudential exposure rises: BIS report

One bank accounts for almost 62% of all crypto-asset prudential exposure, and almost two-thirds of banks holding crypto are in the Americas.

A report released by the Bank for International Settlements (BIS) on February 28th found that about 20 per cent of banks were exposed to encrypted assets. Most of these banks are located in the Western Hemisphere.

According to the report, based on the database in the first half of 2022, Group I banks reported cautious exposure to encrypted assets of about £2.9 billion and escrow encrypted assets of about £1 billion. The first group bank refers to the bank whose tier one capital exceeds 3 billion pounds and has vitality in the world. Tier one capital is the bank's cost of equity capital and published risk reserves.

The 17 banks accounted for slightly less than 20 per cent of the number of banks tested. Of these, 11 are in the Americas, 4 abroad and 2 in other parts of the world. As a result, the ownership of encrypted assets accounts for only a small portion of bank ownership:

"relatively speaking, in the sample of banks reporting exposure to encrypted assets, on a weighted average, prudent exposure accounts for only 0.013 of the total exposure, while managed encrypted assets account for only 0.005 of the total exposure."

International clearing banks have already established norms to limit banks' encrypted risk reserves to 2% at the beginning of 2025.

Of all the banks monitored, encrypted assets account for about 0.003 of their exposure and managed encrypted assets account for about 0.001 of their exposure. Prudential's exposure increased by 30 per cent in the first half, while escrow fell by 66 per cent. The latter figure was particularly affected by the withdrawal of banks from scientific research, while other declines were mainly due to lower values of encrypted assets, according to the report.

One bank of unknown origin accounted for 61.7% of the prudent exposure of all login password assets, while the other four banks accounted for 35% of the exposure. Clearing and trading create nearly 3/4 of all prudent exposures. BTC is a very large basic risk exposure, slightly less than 40% of Coinbase, slightly less than 30%. Medical ether (ETH) ranks far third, less than 5%.

by Derek Andersen
© 2023 WJB All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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