Senators Challenge 1,250% Bitcoin Capital Rule for Banks

Six U.S. senators are actively challenging a proposed 1,250% risk weight for Bitcoin capital requirements. They contend that this significant increase in capital requirements makes holding Bitcoin prohibitively expensive for regulated banks. This regulatory move is expected to have a substantial impact on the institutional adoption of digital assets.

In a related development, major U.S. banks are initiating the launch of tokenized deposits. This strategic move is designed to directly compete with existing stablecoins and to secure dominance for traditional cash assets on blockchain networks. Furthermore, these same banks are reportedly planning to establish a tokenization network. This network aims to counter the growing influence of emerging crypto and stablecoin startups, representing a significant response from the traditional finance sector to the evolving digital asset landscape.

Separately, Bitcoin's market valuation has seen a decline, now representing 0.23% of total global capital. This decrease in its relative value places Bitcoin's purchasing power below the $56,000 mark.