Deutsche Bank has applied for a digital asset custody platform license with the German finance regulator, the Federal Financial Supervisory Authority (BaFin), according to a Bloomberg report.
Speaking at a conference earlier this week, Deutsche Bank’s global head of corporate bank David Lynne said that the bank is “building out our digital assets and custody business,” and confirmed that it had put in an application to BaFin for a digital asset license.
The German bank has reportedly been working on a crypto asset custody platform since late 2020, with a view to establishing a “minimum viable product in 2021 while exploring global client interest for a pilot initiative.”
With assets worth $1.3 trillion, per S&P Global data of largest banks in 2023, Deutsche Bank is the largest bank in Germany in terms of total assets, and Europe’s ninth largest bank.
Deutsche Bank Readying Crypto Custody and Trading Platform
Sometimes it pays to actually read the report. In a December report by the World Economic Forum entitled "Crypto, What Is It Good For: An Overview of Cryptocurrency Use Cases," WEF presents details from Deutsche Bank about a proof of concept for cryptocurrency custody. The report, pointed out by CoinDesk today, demonstrates its desire to expand its product offerings. The proposed "digital asset custody platform" is split into four phases. The first is to provide custody to "institutional invest...
The bank did not respond immediately to Decrypt’s request for comment.
Its enthusiasm for digital asset custody marks something of an about-face for Deutsche Bank, which in a 2021 research note described Bitcoin’s value as being “entirely based on wishful thinking.”
Are German regulators crypto-friendly?
Germany has taken a broadly welcoming stance towards the crypto industry.
In 2019, German lawmakers introduced a bill to enable crypto custody and trading services across German banks and other licensed institutions by amending the European Union’s Fourth Anti-Money Laundering Directive.
New law makes Germany “crypto heaven”
The German parliament today passed a bill allowing banks to sell and store cryptocurrencies from next year. The new legislation will come into force on 1 January 2020, and will require current custody providers and crypto exchanges operating in the country to take steps, before the end of the year, to apply for a German license. The law will not only put Germany, the world’s fourth biggest economy, at the forefront of regulation in cryptocurrencies, but heralds a milestone in the adoption of...
According to BaFin, by December 2022, it had issued four licenses for crypto custody and provisional permits to 14 institutions. Coinbase Germany was the first company to secure a BaFin license for operating a crypto custody platform in June 2021.
In March 2023, the German regulators recently granted custody and trading services licenses to Boerse Stuttgart Digital, the country’s stock market operator, and Finoa, a cryptocurrency trading platform.
