Deutsche Bank, one of the largest banks in Germany, has applied for a license to operate a digital asset custody platform, according to a report by Bloomberg. The bank has been actively developing this platform since late 2020, signaling a significant shift in its stance on cryptocurrencies.
Expanding Digital Assets and Custody Business
During a conference, David Lynne, Deutsche Bank’s global head of corporate banking, announced that the bank is expanding its digital assets and custody business. The application for a digital asset license has been submitted to the German finance regulator, the Federal Financial Supervisory Authority (BaFin).
The Significance of Deutsche Bank’s Move
As the ninth largest bank in the European banking sector and with assets valued at $1.3 trillion, Deutsche Bank’s entry into the digital asset custody space carries substantial weight. This move marks a departure from its previous skepticism towards Bitcoin, as expressed in a 2021 research note.
Germany’s Positive Attitude Towards Cryptocurrency
Germany has shown a generally positive attitude towards the cryptocurrency industry. In 2019, the country introduced legislation that enabled crypto custody and trading services across its banks and licensed institutions by amending the European Union’s Fourth Anti-Money Laundering Directive.
BaFin’s Crypto Custody Licenses
BaFin, the German finance regulator, has issued four licenses for crypto custody and provisional permits to 14 institutions as of December 2022. Coinbase Germany became the first company to obtain a BaFin license for operating a crypto custody platform in June 2021. More recently, in March 2023, custody and trading services licenses were granted to Boerse Stuttgart Digital, the stock market operator, and Finoa, a cryptocurrency trading platform.
Increasing Acceptance and Adoption of Digital Assets
The granting of licenses to various institutions and the involvement of Deutsche Bank, along with other recent developments, demonstrate the growing acceptance and adoption of digital assets in the German financial landscape.
Important Considerations and Disclaimer
Readers are advised to exercise caution and seek expert advice when dealing with crypto products and NFTs. These assets are unregulated and can be highly risky. Cryptocurrency is not a legal tender and carries market risks. Potential investors should carefully study offer documents and related literature before making any investments. Cryptocurrency market predictions are speculative, and any investment should be made at the sole cost and risk of the readers.
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