UK watchdog asks firms to share current and future crypto exposures

The Prudential Regulation Authority (PRA) has asked businesses in the UK to disclose current and future crypto exposures by March 2025, in order to assess financial stability and set policy.

The Bank of England’s regulatory division issued the request on Friday, amid a growing number of UK firms embracing crypto. The PRA has also asked firms to explain how they use the Basel framework, which sets standards and minimums for bank capital requirements.

“This will inform work across the PRA and the Bank of England on cryptoassets by helping us calibrate our prudential treatment of cryptoasset exposures, [and] analyze the relative costs and benefits of different policy options,” the PRA said.

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Additionally, the PRA requests information on businesses’ use of permissionless blockchains. In the questionnaire that they have been asked to complete, the PRA highlighted the risks of these ledgers.

“…they also pose risks such as lack of settlement finality, settlement failure, and no guaranteed link between the intended owner of the asset and the entity that may have control of the authentication, validation mechanism,” the document said.

UK firms taking part in the questionnaire must consider future crypto exposures up to September 30, 2029. Businesses have until 24 March, 2025 to respond.

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