US Fed to release proposal on Basel's 1250% crypto risk weight next week

The U.S. Federal Reserve is expected to release a public proposal next week on how to apply the Basel III Accord's 1250% risk weight rule to American banks. Conor Brown, managing director of the Bitcoin Policy Institute (BPI), noted on X that under the current Basel framework, Bitcoin is classified as a harmful asset and is subject to an exceptionally high 1250% risk weight. He explained that this figure is substantially higher than that for nearly all other assets, making it difficult for banks to provide financial services to Bitcoin investors and related businesses. Once the Fed's proposal is published, a 90-day feedback period will commence.