BIS Warns Cryptocurrency Exchanges Are Becoming ‘Shadow Banks’

Large cryptocurrency exchanges have expanded beyond matching trades and providing custody into lending, margin trading, derivatives and yield products, becoming “multifunction crypto-asset intermediaries,” or MCIs. Once users hand over their assets, they effectively become unsecured creditors of the platforms, without deposit insurance, central bank liquidity or bank capital requirements. The successive collapses of Celsius and FTX in 2022 highlighted the risks of runs and related-party transactions.

The Bank for International Settlements’ Financial Stability Institute published a 38-page report on April 23, 2026, examining the terms of major platforms between November 2025 and March 2026. The report estimated that the crypto-asset market was worth about $3 trillion at the end of 2025, while centralized exchanges recorded roughly $6 trillion to $8 trillion each in spot and futures trading volume in a recent quarter. A flash crash in October 2025 also triggered about $19 billion in forced liquidations.