Deutsche Bank is in the process of acquiring a license to provide custody for digital assets in Germany.
In Brief
Deutsche Bank is actively pursuing a license that would allow it to offer crypto custody services within Germany.
David Lynne, who heads the commercial banking division at Deutsche Bank, stated that this initiative aligns with the bank's larger vision to boost its fee revenue.
The esteemed German banking powerhouse, Deutsche Bank, has lodged a formal request with BaFin for a crypto custody license, as noted by Bloomberg. report .
During a conference on Tuesday, David Lynne, the leader of Deutsche Bank's commercial banking segment, mentioned, \"We have officially submitted our application to BaFin for the digital asset custody license.\" He emphasized that this strategy is a crucial part of the bank's intent to enhance its fee-based revenues within the corporate banking division.
Back in 2020, Deutsche Bank first unveiled its ambition to establish a digital asset custody platform aimed at institutional clients. The bank elaborated on its intentions in a report published in December 2020. report This report, shared by the World Economic Forum, was titled 'Crypto, What Is It Good For: An Overview of Cryptocurrency Use Cases.'
According to the report, Deutsche Bank affirmed that it had successfully completed its proof of concept and was targeting the release of a minimum viable product in 2021, meanwhile gauging global client interest for a pilot program.
The proposed platform aspires to simplify the handling of a variety of digital assets and fiat currencies through a consolidated, user-friendly interface, serving as a gateway for additional services from both the bank and third-party providers. The bank also plans to implement a high-quality hot/cold storage solution backed by robust insurance to safeguard clients' funds.
The report detailed that the rollout of the digital asset custody platform is set to occur in four phases. Initially, it will offer insured custody services for carefully vetted digital assets, specifically targeting institutional players like asset managers, wealth managers or family offices, corporations, and digital investment funds.
Subsequently, the platform will facilitate the buying and selling of digital assets via partnerships with prime brokers, issuers, and trusted exchanges, ensuring seamless functionality across systems. In its final phase, the platform will expand to include a range of valuable services such as tax assistance, asset valuation, fund administration, lending, staking, voting, and a robust open-banking system to onboard third-party service providers. Additionally, it will feature trading and issuance capabilities.
The platform will also encompass a full suite of regulated banking services like KYC/AML compliance, settlement solutions, and more.
In April, DWS, Deutsche Bank’s asset management subsidiary, teamed up with Galaxy Digital to create a comprehensive range of exchange-traded products (ETPs) focused on select digital assets within Europe. announced a partnership BaFin, Germany's financial regulatory body, has been proactive in issuing licenses for crypto custody services. By December 2022, BaFin had granted four licenses for crypto custody operations and issued provisional permits to 14 institutions, marking a significant acceptance of digital asset custodianship in Germany. Notably, Coinbase Germany was the first to secure a BaFin license for its crypto custody services in June 2021.
In March 2023, both Boerse Stuttgart Digital, the operator of Germany's stock market, and Finoa, a cryptocurrency trading platform, were granted licenses for custody and trading services.
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In line with the Trust Project guidelines Cindy serves as a journalist for Metaverse Post, delving into themes surrounding web3, NFTs, the metaverse, and artificial intelligence, emphasizing interviews with leaders in the Web3 sector. Having spoken to more than 30 C-level executives, she shares their insightful perspectives with the audience. Originally hailing from Singapore, Cindy is currently residing in Tbilisi, Georgia. She possesses a Bachelor’s degree in Communications & Media Studies from the University of South Australia and boasts a decade of experience in journalism and writing.
