BIS warns: Crypto exchanges are evolving into "shadow banks," exposing users to unsecured risks.

A report released by the Bank for International Settlements (BIS) points out that cryptocurrency exchanges are gradually offering banking-like services, such as lending and yield products (Earn), but lack the regulation and deposit protection found in traditional financial systems, posing a potential systemic risk. The report states that these high-yield products are essentially closer to "unsecured loans," with user assets often used by the platform for high-risk operations such as lending, trading, or market making, while users only have claims against the platform. If the platform encounters problems, users will be directly exposed to repayment risks. The BIS also states that leading cryptocurrency platforms have evolved from single exchanges into "multi-functional intermediaries," integrating the functions of banks, brokerages, and exchanges, but lack transparency and risk isolation mechanisms. The previous collapses of Celsius Network and FTX are typical examples of this structural risk. Furthermore, the report mentions the cryptocurrency market flash crash in October 2025, which triggered approximately $19 billion in forced liquidations, highlighting the chain reaction risks under high leverage and opaque structures. (CoinDesk)