The FSB’s 2025 report highlights that crypto’s $4.3 trillion market cap and deepening ties to traditional finance create systemic risks. Stablecoin adoption in payment systems and Bitcoin ETFs’ $800 billion AUM particularly concern regulators.
The report warns that crypto’s correlation with equity markets has increased to 0.78, reducing its diversification benefits while amplifying contagion risks. Recent stress tests show a 50% crypto market crash could trigger $120 billion in losses across leveraged TradFi institutions.
In response, the FSB proposes enhanced capital requirements for banks’ crypto exposures and real-time transaction monitoring mandates. These recommendations will inform G20 policy discussions, with implementation likely phased through 2026-2028.
