The European Banking Authority (EBA) has confirmed a stringent regulatory stance on banks holding Bitcoin (BTC) and Ethereum (ETH), imposing a 1250% risk weight. This decision, reported by Cointelegraph, aims to standardize the capital requirements for EU banks dealing with crypto assets. The EBA classifies digital assets into groups, with unbacked cryptocurrencies like Bitcoin falling under 'Group 2b.' This classification carries the hefty 1250% risk weight, meaning banks must hold capital equivalent to the full value of their Bitcoin and Ethereum holdings. This move reflects growing concerns about the volatility and inherent risks associated with unbacked crypto assets within the traditional financial system. The high risk weight discourages significant bank exposure to these assets and aims to protect financial stability across Europe. Banks are now tasked with reassessing their crypto strategies in light of these new capital requirements. ```

#BTC #ETH