A coalition of leading global financial trade associations (“the Joint Trades”), together with Boston Consulting Group (BCG), Ashurst, and Sullivan & Cromwell as technical advisors, issued a letter to the Basel Committee on Banking Supervision (BCBS) urging a pause and recalibration of the Cryptoasset Exposures Standard (SCO60) and a comprehensive report highlighting the transformative potential of Distributed Ledger Technology (DLT) in capital markets.

The Joint Trades recommend essential revisions of the Basel banking prudential treatment of cryptoassets and pausing implementation of SCO60 ahead of its January 2026 effective date to allow for a targeted consultation and redesign. The letter highlights the excessively conservative and overly punitive capital treatment of cryptoassets that is misaligned with actual risks, in addition to various inconsistencies with current market risk management practices. The Joint Trades urge the BCBS to make revisions to the cryptoasset standard to better reflect actual risk profiles and to support responsible innovation within the regulatory perimeter.

The accompanying report, titled “The Impact of DLT in Capital Markets: Ready for Adoption, Time to Act”, illustrates how tokenization and DLT are reshaping securities issuance, collateral management and fund operations, with live use cases demonstrating significant efficiency gains, enhanced transparency and improved risk management.  Importantly, the report describes how the overall size and significance of the cryptoasset market have increased, rendering many of the premises underlying the Basel standard outdated and requiring important adjustments.

Key Report Highlights

DLT is ready to scale: Institutional adoption is accelerating, with tokenized money market funds and digital bond issuances gaining traction globally.

Technology-neutral regulation is essential: The Joint Trades emphasize that prudential frameworks must focus on the underlying financial activity and risk—not the technology used. Overly conservative capital treatments for cryptoassets risk pushing innovation outside the regulatory perimeter.

Legislation and regulation must catch up: Reform needs to keep pace with development of DLT-based finance and market developments.

DLT enables safer, more efficient markets: Use cases such as collateral management, fixed-income issuance and fund tokenization demonstrate reduced settlement times, improved liquidity and enhanced operational resilience.

Six priority areas for ecosystem development:

• 1. Accelerate market development in high-potential asset classes.
  2. Clarify legal foundations and align regulatory treatment.
  3. Establish interoperability to prevent market fragmentation.
  4. Address technical and operational integration gaps.
  5. Enable scalable settlement with tokenized money and stable payment instruments.
  6. Foster public-private coordination.

The stage for mass adoption of tokenization in capital markets is set, driven by clearer regulatory pathways, mature technology platforms and committed institutional participation. Now is the time for coordinated action to harness the benefits of DLT, modernize financial infrastructure and support sustained economic growth.

The Joint Trades include the Global Financial Markets Association (GFMA) and its members the Asia Securities Industry & Financial Markets Association (ASIFMA), Securities Industry and Financial Markets Association (SIFMA) and the Association for Financial Markets in Europe (AFME); Bank Policy Institute (BPI); Futures Industry Association (FIA); Financial Services Forum (FSF); Global Blockchain Business Council (GBBC); Global Digital Finance (GDF);  Institute of International Finance (IIF); International Swaps and Derivatives Association (ISDA).

Download the full “Impact of DLT on Capital Markets” report here and the prudential letter here.

Source: AFME