Denmark’s financial watchdog ordered Saxo Bank to dispose of its own holdings of cryptoassets, saying banks aren’t allowed to conduct proprietary trading under current regulations.

Saxo Bank, which has a platform for customers to trade crypto, also holds its own cryptoassets as a hedge against market risk, the Danish Financial Supervisory Authority said in a statement Wednesday. Such trading isn’t on the list of legal business activities for financial institutions in Denmark, it said.

The closely held, Copenhagen-based bank is under heightened regulatory scrutiny after being named for the first time as a systematically important financial institution last month.

Saxo didn’t immediately respond to requests for comment.

New rules around crypto markets will only take full effect from end-2024, so the area “remains unregulated for the time being,” the FSA said. “Unregulated trading in cryptoassets can create distrust in the financial system, and the Danish FSA believes it would be unfounded to legitimize trading in cryptoassets.”