What is Bank for International Settlements (BIS)?
Let's find out Bank for International Settlements (BIS) meaning, definition in crypto, what is Bank for International Settlements (BIS), and all other detailed facts.
The Bank for International Settlements (BIS) is an international financial institution. It advocates for global financial and monetary stability. The BIS is responsible for coordinating central banks and monetary policies around the world.
The BIS is referred to as the central bank for central banks. It provides banking services to financial institutions like the European Central Bank, Bank of England, and the US Federal Reserve.
Some of the services offered by the Bank for International Settlements are gold and currency transactions, asset management, and fixed-rate investments.
The institution was founded in 1930, following the Treaty of Versailles, to facilitate the World War I reparations imposed on Germany. The founding members of the BIS were Belgium, France, Germany, Italy, Japan, Switzerland, the United Kingdom, and the US. Following the establishment of the BIS, Germany’s reparations were discontinued.
The aim of the Bank for International Settlements is to maintain transparency of financial and monetary policies across all member states.
Although each nation has the right to determine its own policies, they are subject to central and private banking scrutiny. Regulations in place may affect the foreign exchange rates and the import and export between nations.
In recent years, the BIS has started looking into developments in the Big Tech sector. In 2021, the BIS gave full backing to the development of central bank digital currencies (CBDCs).
CBDCs function as the digital version of fiat currencies, offering the same value and functionality. They are issued and regulated by central banks and therefore come under the jurisdiction of the Bank for International Settlements. CBDCs are legal tender and differ from stablecoins which have their value pegged to fiat currencies or other assets.
There are currently 60 member banks under the BIS cooperative system from all around the world. Alongside the European Central Bank, the central banks of each member state of the EU are also members of the institution.