Basel III Framework

Definition ∞ Basel III Framework represents a global regulatory standard for bank capital adequacy and liquidity. It was developed to strengthen the regulation, supervision, and risk management of the banking sector. The framework specifies minimum capital ratios and liquidity standards for financial institutions. These rules aim to improve bank solvency and reduce systemic risk.
Context ∞ Within cryptocurrency news, the Basel III Framework is highly relevant for how banks classify and provision for digital asset holdings. Regulators are evaluating how existing capital rules apply to novel crypto exposures. Discussions frequently center on setting appropriate risk weights for various digital assets held on bank balance sheets.