Pierre Rochard, CEO of The Bitcoin Bond Company, has told US banking regulators that their broad Basel III capital rewrite fails to clarify how Bitcoin-related activities should be treated, leaving legal uncertainty and potentially altering how much capital banks must hold against the asset.
In a formal comment submitted March 29 to the Federal Reserve, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency, Rochard said agencies cannot finalize rules that effectively determine capital treatment for Bitcoin (BTC) activities without clearly explaining the framework and evidence behind that treatment.
The regulators’ March 19 proposals, a package intended to overhaul the US bank capital framework, do not mention Bitcoin, crypto or digital assets. The proposals address credit, market and operational risk and counterparty exposures for the largest US banks but leave unclear how existing categories apply to BTC holdings, lending, custody and derivatives.
That omission matters because the Basel Committee’s crypto asset framework (SCO60) already imposes a severe capital treatment on certain unbacked crypto exposures. Rochard said US regulators must clarify whether they intend to adopt SCO60, apply parts of it selectively, or rely on established domestic capital categories. Without that clarity, the economics of custody, lending, derivatives and direct holdings remain unresolved.
Rochard cautioned that a final rule that silently imposes (or preserves) a capital treatment for Bitcoin-related activities without explicit explanation could face legal challenge. He argued regulators cannot leave this question open and must set out the reasoning and evidence for any treatment they apply.
The CEO pointed out regulators have been explicit about other digital assets. On March 5, they issued a tokenized securities FAQ stating eligible tokenized securities should generally receive the same capital treatment as their non-tokenized counterparts and that the capital framework is “technology neutral,” giving banks clear guidance in that area. By contrast, no comparable guidance exists for Bitcoin exposures, forcing banks to interpret how rules apply to direct BTC holdings, Bitcoin-collateralized lending, custody services and derivatives.
Before the re-proposal, some analysts hoped the changes might lower capital requirements and unlock liquidity for Bitcoin-related activities. In his comment on X, Rochard wrote: “The fiat system should stop sabotaging itself. Bitcoin banking rules would improve bank net interest margins and lower interest rates for borrowers.”
Cointelegraph contacted Rochard for further comment but had not received a response by publication.
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