For the first time in Germany’s history, a local bank, Commerzbank, has applied for a license to provide crypto services. On April 14, a spokesperson for Commerzbank confirmed the news to the local newspaper Börsen-Zeitung.
According to the representative, the bank “applied for the cryptocurrency custody license in the first quarter of 2022.” The Federal Financial Supervisory Authority, the country’s financial regulator, has yet to provide feedback to the institution (BaFin).
It is worth noting that Commerzbank is one of the country’s largest financial institutions. Over 18 million customers and 70,000 institutional clients are served by the bank. If the bank’s license application is approved, it will be able to offer a variety of cryptocurrency-related services. Crypto exchange, custody, and asset protection are among the services on the list. These, it is said,
German Bank Commerzbank pushing for crypto adoption
Starting this year, any German company that wanted to provide crypto services had to obtain BaFin approval. At the moment, the watchdog has only issued operating permits to four companies. In June 2021, Coinbase’s Germany branch was the first to receive approval. The most recent is Upvest, a Berlin-based fintech firm that obtained a license in March.
Meanwhile, 25 other companies have submitted applications, with Commerzbank being the most recent to do so.
Commerzbank’s move comes as no surprise given the bank’s long-standing interest in blockchain projects. In 2019, the bank and two others completed the first transactions on a security lending platform’s distributed ledger technology (DLT).
A more recent collaboration occurred in August 2021. Commerzbank and Deutsche Boerse have made a joint investment in a company that is developing blockchain-based digital marketplaces for assets such as art and real estate.
Crypto adoption in Germany
Germany developed a set of blockchain and cryptocurrency regulations that will last until 2021. Although strict, the rules focused on allowing adoption while protecting consumers and preventing criminal activity.
For example, laws in the “Spezialfonds” category allow institutional investors to invest up to 20% of their holdings in cryptocurrency. Union Investment, the country’s 500-billion-dollar asset management behemoth, was reportedly looking to add Bitcoin exposure to several of its funds.
Aside from the BaFin-approved crypto licenses, Germany is already showing signs of increased crypto adoption. According to a Kucoin report published in March, 44 percent of Germans are “motivated to invest in cryptocurrencies.” Furthermore, 37% of those who own cryptocurrencies started trading digital assets a year ago.
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