ISDA, in partnership with a coalition of leading global financial trade associations (“Joint Trades”), and with advisory support from Boston Consulting Group (BCG), Ashurst, and Sullivan & Cromwell, submitted a letter to the Basel Committee on Banking Supervision (BCBS). The letter calls for a pause and recalibration of the Cryptoasset Exposures Standard (i.e., SCO60).

The Joint Trades are urging BCBS to delay the implementation of SCO60, currently scheduled for January 2026, to allow time for a targeted consultation and redesign of the framework. The letter argues that the current standard imposes overly conservative and punitive capital requirements that do not accurately reflect the actual risks of cryptoassets and are inconsistent with established market risk practices. The letter emphasizes the need for a more balanced approach that aligns with actual risk profiles and encourages responsible innovation within the regulatory framework.

To that end, the Joint Trades propose a set of non-exhaustive recommendations to improve the Cryptoasset Standard, in line with core principles of safety, soundness, and technology neutrality, including:

1. Eliminating the distinction between permissioned and permissionless ledgers for Group 1 classification.
2. Revising classification condition 2.
3. Reconsidering the treatment of regulated stablecoins.
4. Recognizing certain cryptoassets as eligible collateral.
5. Reassessing the treatment of Group 2 cryptoassets.
6. Allowing the use of internal models for market and counterparty risk.

Alongside the letter, the Joint Trades also released a detailed report titled “The Impact of DLT in Capital Markets: Ready for Adoption, Time to Act.” This report underscores the growing significance of the cryptoasset market and highlights the transformative potential of Distributed Ledger Technology (DLT) in capital markets. It argues that the evolution of the market has rendered many of the assumptions underpinning the Basel standard outdated, and that a reassessment is now necessary.