The Federal Reserve has proposed a new margin scheme treating cryptos as an asset class of their own. The proposal would help better manage crypto’s high price volatility and address some of the risks associated with derivatives, in which traders borrow money and must provide collateral. 

Current systems fail to capture crypto’s specific risks, the central bank found, and new rules could help establish a safer, more stable trading environment. The proposal stems from a working paper published on Wednesday by Federal Reserve researchers Anna Amirdjanova, David Lynch, and Anni Zheng. 

They caution that crypto assets should be classified separately when calculating initial margin requirements. Initial margin is the amount…