European Central Bank to set criteria for crypto services for banks

Scrutiny is increasing in many countries regarding the crypto segment. The European Central Bank (ECB) has said that it will prepare criteria for banks to provide services in this segment. Under this, it will be ensured that banks have sufficient capital and expertise for this. Crypto exchanges such as Binance have been licensed in several European countries such as Italy, France, Spain and Germany after complying with measures against money laundering and funding for terroristic activities.

Reuters reports that licensing rules for crypto services may come into force in the European Union (EU) next year. “Some crypto services in Germany require a banking license and a number of banks have requested permission for these services,” the ECB said in a statement. The ECB regulates many large banks in Europe. These include Deutsche Bank, UniCredit and BNP Paribas. The ECB will also examine whether a bank has the ability to identify and assess risk from crypto assets. Ville Niinisto, a member of the Green Party in the European Parliament, has proposed an amendment. It states that banks’ holdings in bitcoin and other cryptocurrencies for which assets are not guaranteed should not exceed one percent of the bank’s core Tier 1 capital.

Recently Binance was fined around 3.3 million euros by the Dutch Central Bank (DNB) for providing services without registration in the Netherlands. DNB reported that the exchange had been warned last year. Binance indicated an appeal against it in a statement in June. A Reuters report noted that Binance had violated money-laundering laws in the Netherlands and had an advantage over firms that registered with the DNB.

An exchange spokesperson said the firm has opened a branch in the Netherlands. This problem has been resolved. However, DNB said that it has not approved the registration of the exchange but has reduced the penalty due to the disclosure of the firm’s own functioning.

(This news has not been edited by NDTV team. It has been published directly from Syndicate feed.)

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