BIS Warning: Cryptocurrency exchanges are evolving into "shadow banks," and users face unprotected risks

ME News Report, April 23 (UTC+8), the Bank for International Settlements (BIS) released a report stating that crypto exchanges are gradually offering banking-like services such as lending and yield products (Earn), but lack the regulation and deposit guarantees of traditional financial systems, posing systemic risks. The report states that these high-yield products are essentially more akin to “unsecured loans,” with user assets often used by platforms for lending, trading, or market-making activities, and users only hold claims against the platform. If the platform encounters issues, users are directly exposed to repayment risks. BIS also noted that leading crypto platforms have evolved from single exchanges into “multi-functional intermediaries,” integrating banking, brokerage, and exchange functions, but lack transparency and risk isolation mechanisms. Previously, the collapses of Celsius Network and FTX are typical examples of such structural risks. Additionally, the report mentions that in October 2025, a crypto market flash crash triggered approximately $19 billion in forced liquidations, highlighting the chain reaction risks under high leverage and opaque structures. (Source: ChainCatcher)