“Bank of England Gives Companies Until March 2025 to Disclose Crypto Exposure”

One of the oldest central banks in England is giving companies until March 2025 to disclose their exposure to cryptocurrencies.

In a new announcement, the Bank of England states that the Prudential Regulation Authority (PRA) – the financial regulator of the United Kingdom – wants to collect data on companies’ current and future exposure to crypto. It indicates the following:

“These [data] will inform the work of the PRA and the Bank of England in the field of crypto assets by helping us calibrate our prudential treatment of exposure to crypto assets, analyze the relative costs and benefits of different policy options, and provide an updated picture of companies’ current and intended crypto asset-related business activities as a basis for monitoring the financial stability implications of these assets.”

Some of the disclosure requirements include all activities related to digital assets and how the bank benefits from them, the bank’s risk management policy regarding crypto, an overview of how the bank reports its crypto assets, and the key crypto-related risks to which companies are exposed and how they plan to manage them, according to the PRA’s questionnaire. It continues with:

“The decision to hold crypto assets (either under trading or banking book) and provide services to crypto asset operators must be fully in line with the bank’s risk appetite and strategic objectives as established and approved by the board of directors, as well as with the assessment by senior management of the bank’s risk management capabilities.”

According to the PRA’s second framework for crypto assets, released in 2022, companies still cannot fully mitigate the risks of using permissionless blockchains.