EU Crypto Banking License Procedures Are Too Inconsistent, ECB Says

Requests for crypto licenses by banks that are in countries in the European Union need to be more consistent given the divergence of crypto laws within the region, the European Central Bank said in its annual report published Tuesday.

A number of requests are coming from technology-driven banks, and the ECB wants to impose more control over the fragmented system.

“National frameworks governing crypto assets vary quite significantly,” the central bank said. “The ECB is taking steps to harmonize the assessment of licensing requests involving crypto assets.”

Most applications for licenses have come from Germany because of requirements under that country's national law and one came from Luxembourg, the ECB said.

While national supervisors such as Germany’s BaFin are responsible for monitoring smaller banks that lie within its borders, the ECB has the final right to decide whether to grant or withdraw a license.

In February, the ECB told banks to follow tough new capital standards that could dissuade them from holding unbacked crypto assets like bitcoin (BTC), even as a survey found that banks’ exposures to crypto was “insignificant.”

Read more: EU Banks Told by Regulator to Apply Bitcoin Caps Even Before They Become Law