OSFI eases banks’ crypto limits
Under the revised guidelines, the regulator said financial institutions’ gross exposure to so-called “group 2” crypto assets — this refers to assets such as bitcoin, ether and other cryptocurrencies, and coins that aren’t backed by underlying assets — will now be limited to 5% of tier 1 capital, up from the previous limit of 1%.
Additionally, OSFI dropped the requirement that group 2 exposures that exceed 1% of tier 1 capital face the strictest capital treatment. The capital requirements that apply to so-called “group 2b” assets, including a risk weight of 1,250% and hedging, isn’t recognized.
These changes take effect Nov. 1 for institutions that end their fiscal years on Oct. 31. They take effect Jan….
