Banking Supervision Integration

Definition ∞ Banking Supervision Integration refers to the process of incorporating oversight of novel financial activities, such as those involving digital assets, into existing banking regulatory frameworks. This aims to apply established prudential standards and consumer protection measures to new market participants and technologies. The goal is to ensure systemic stability and mitigate risks associated with evolving financial services. This approach seeks to bridge traditional finance with digital innovations.
Context ∞ The current state of banking supervision integration is a dynamic area, with regulators worldwide grappling with how to effectively oversee digital asset activities without stifling innovation. A key debate involves determining which digital assets fall under traditional banking purview and which require new regulatory categories. Future developments will include harmonized international standards and specialized regulatory sandboxes to facilitate responsible adoption of blockchain technology within the financial sector.