Introduction

60.1 This chapter sets out how the Basel Framework is to be applied in respect of banks' exposures to cryptoassets. Cryptoassets are defined as private digital assets that depend on cryptography and distributed ledger technologies (DLT) or similar technologies. Digital assets are a digital representation of value, which can be used for payment or investment purposes or to access a good or service.

60.2 Dematerialised securities (securities that have been moved from physical certificates to electronic book-keeping) that are issued through DLT or similar technologies are considered to be within the scope of this chapter and are referred to as tokenised traditional assets, whereas those dematerialised securities that use electronic versions of traditional registers and databases which are centrally administered are not within scope.

60.3 The prudential treatment of central bank digital currencies (CBDCs) is not described within the Basel Framework. The Committee will give further consideration to the treatment of CBDCs as they are issued.

60.4 For the purposes of this chapter, the term "exposure" includes on- or off-balance sheet amounts that give rise to credit, market, operational and/or liquidity risks. Certain parts of the chapter, such as the operational risk requirements and the risk management and supervisory review sections, are also applicable to banks' cryptoasset activities, such as custodial services involving the safekeeping or administration of client cryptoassets on a segregated basis, that do not generally give rise to credit, market or liquidity requirements.