Response to consultation on Regulatory Technical Standards on the calculation and aggregation of crypto exposure values
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Q7: For ARTs subject to the calculation of own fund requirements for market risk in this para-graph, do you agree that the risk of default of the issuer is relevant in certain specific circum-stances and therefore should be considered within the scope of these draft RTS during the tran-sitional period as per Article 3(4)(d) or do you believe that the 250% RW for direct credit risk is sufficient to capture for this risk during the transitions period? Please briefly justify your as-sessment.
No. As noted in our accompanying letter, a risk weight of 250% for issuers of stablecoins both ignores the Basel Standard of a look through approach and is particularly high given the own funds requirement and the requirement to maintain a reserve of underlying assets. For ARTs subject to the own funds requirement but not the reserve requirement, raising the risk weight above 250% for certain ARTs but not others would be inconsistent with both the Basel Standard and MiCAR. This would abuse the discretion granted to consider and fairly apply elements of both referenced standards during the transition period as per Article 3(4)(d).