The Bank of England is planning to introduce new proposals for banks’ exposure to crypto in 2026 to protect financial stability, an important official said Wednesday.
The United Kingdom is looking to formulate rules that are more on the restrictive side, said David Bailey, the CEO of PrudiTial Policy at Bank of England, in a speech in Risk Live Europe, London.
Bailey suggested that the country is likely to encourage banks to have a low exposure to crypto.
“There are also examples where it may be more appropriate to start more against the restrictive end of the spectrum, while evidence has been collected to see if standards can be eased over time,” Bailey said. “The cautious treatment of banks’ exposures to cryptoassets, and specifically those with functions associated with increased award volatility and where investors could lose their entire investment is an example in this room.”
The nation seeks to implement the Basel Committee for Bank Monitoring Disclosure Framework for Banks’ exposure to crypto. This framework must be introduced at the beginning of 2026 to help nations evaluate risks, the committee says. The committee also proposed rules that banks should limit exposure to crypto as Bitcoin to 1%.
Britain’s plans will be “informed” by the standards developed by the Basel Committee, Bailey said.
Nations have been looking to ensure that they can maintain financial stability despite crypto volatility by monitoring how interconnected banks should crypto, especially after the collapses of the Silicon Valley Bank and Silvergate Bank in 2023, both of which had crypto clients.
The United Kingdom’s prudential crypto rules come at a time when the country’s other financial regulator – Financial Conduct Authority – is set to implement a new regime for crypto.
Read more: UK regulator intends to start authoring cryptic companies in 2026
