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UK Regulator Requests Data on Cryptoasset Exposures from Firms
The Prudential Regulation Authority (PRA), part of the Bank of England, has issued a data request to firms, seeking information on their current and planned exposures to cryptoassets. The request aims to gather data on tokenized assets and stablecoins, with the goal of informing policymaking and calibrating prudential frameworks for managing cryptoasset exposures.
The data collection initiative is part of the global Basel framework, which guides the prudential treatment of cryptoassets. Firms have until March 24, 2025, to submit their responses. The PRA emphasized that the information will be used to analyze the costs and benefits of potential regulatory approaches and establish a baseline for monitoring developments in the sector.
Use of Tokenized Assets and Stablecoins
The Bank of England is particularly interested in understanding how firms navigate risks associated with tokenized assets and stablecoins while engaging in crypto-related business activities. This interest is not new, as the Bank for International Settlements partnered with the Bank of England on a pilot project called “Project Pyxtrial” to track stablecoins’ reserves. The project aimed to provide regulators with near real-time data on stablecoins’ liabilities and backing assets.
The current data collection request is a step further in this direction, aiming to gather information on the use of tokenized assets and stablecoins in the industry. The PRA has provided a data template for firms to complete, with sections applicable to their operations. Firms without cryptoasset exposures are not required to submit a response.
Who Needs to Respond?
Only entities with relevant cryptoasset exposures or activities need to provide information. However, firms are asked to complete sections of the data template that apply to their operations. A “nil return” is not required from those without exposure.
“The PRA’s data collection initiative is a significant step towards understanding the cryptoasset landscape in the UK. By gathering data on tokenized assets and stablecoins, the regulator can make informed decisions on policymaking and regulating the sector.”
This development highlights the growing importance of cryptoassets in the financial sector. As the regulatory landscape continues to evolve, it is essential for firms to stay informed and adapt to changing requirements. Stay up-to-date with the latest news and developments in the crypto space on Global Crypto News.
