Here's what's going on here: banks use debt to increase their returns. A bank might have $100M in capital, $1B in assets, and $900M in debt. Now, to keep things from getting too crazy, there are national and international regulations limiting how much they can borrow. Those limits depend on how risky the assets are that they're buying. US government bonds? You might need to have 3 cents in capital for every dollar of T Bonds. For high quality commercial bonds, maybe 5 or 10 cents.
Cryptocurrency is a new asset class, so they have to decide how much capital a bank needs to hold. Quite sensibly, given its volatility, you need $1 in capital to hold $1 in crypto. I.e. a bank cannot borrow against its crypto holdings.
Cryptocurrency is a new asset class, so they have to decide how much capital a bank needs to hold. Quite sensibly, given its volatility, you need $1 in capital to hold $1 in crypto. I.e. a bank cannot borrow against its crypto holdings.