After taking a long, cautious approach, the banking sector in Germany is gradually warming up to the cryptocurrency space with a number of agreements and the debut of crypto services in 2023.
The Federal Financial Supervisory Authority (BaFin), the nation’s financial watchdog, has apparently received an application for a digital asset custody license from Deutsche Bank, the largest banking organization in Germany. The action is considered as an effort to expand its digital asset custody services, including cryptocurrency, and diversify its revenue sources.
This is a similar turn from the investment arm of Deutsche Bank, DWS Group, which has shown interest in funding two German cryptocurrency companies. The parties to the negotiations are Tradias, a market maker, and Deutsche Digital Assets, a producer of cryptocurrency exchange-traded instruments.
The corporate bank division of Deutsche Bank initially disclosed ambitions to deliver services relating to digital assets in 2020, but had not established a timetable for their introduction. On the other hand, the bank’s chief of commercial banking, David Lynne, declared on June 20 that the organization is actively growing its “digital assets and custody business” and has asked for a license from BaFin.
Although Deutsche Bank had previously criticized Bitcoin and the turbulence of the cryptocurrency market, their attitude on the sector has changed as of 2023. Project DAMA (Digital Assets Management Access), a tokenized investing platform, underwent successful trials in February under the direction of Deutsche Bank Singapore and Memento Blockchain. In addition to offering consumers a straight fiat-to-digital on-ramp, the platform also introduced its own coin.
Deutsche Bank’s choice to apply for a license to hold digital assets shows that it understands the growing significance of cryptocurrencies and blockchain technology in the financial sector. The bank wants to take advantage of the changing industry and fulfill the rising demand from its clients for dependable and safe custody solutions by extending its services to encompass digital assets.
Additionally, wpNex, a platform focusing on Bitcoin for retail users, was introduced by German securities processor Deutsche WertpapierService Bank. Customers can use the platform to maintain cryptocurrency accounts in addition to their conventional bank accounts without going through any additional Know Your Customer procedures.