The action taken by Deutsche Bank to obtain the Bafin license is a component of a larger plan to boost fee income for the business segment.
The recent regulatory crackdown by Western finance regulators hasn’t stopped major players from entering the cryptocurrency market. The largest bank in Germany, Deutsche Bank AG, has just submitted a regulatory application to be allowed to provide custodial services for digital assets like cryptocurrency.
According to David Lynne, who oversees the lender’s commercial banking division, this move is part of a larger plan by Deutsche Bank to boost fee income for its corporate division. It also points out the bank’s efforts to boost revenue for its investment arm DWS Group through services related to digital assets. In a statement to Bloomberg, Lynne stated:
“We are expanding our business dealing with digital assets and custody. For the digital asset license, we just submitted an application to Bafin.
This is not the first time Deutsche Bank has taken steps to provide custody services for digital assets. In 2020, it made a similar attempt, but it never said when it would start offering the services.
The requirement for regulated custodial solutions providers will grow as institutional player activity in the crypto sector increases. As a result, Deutsche Bank is acting at the ideal time as major firms like BlackRock and Fidelity already express their intention to enter the cryptocurrency market.
Germany, Deutsche Bank, And Cryptocurrency
The new move by Deutsche Bank comes only a few months after the bank had a severe liquidity problem in March of this year following the collapse of Credit Suisse. The massive German financial organization, however, confidently made it through this and appears to be in good shape.
German regulators, on the other hand, have also been attempting to relax the laws governing crypto staking and lending. Additionally, the introduction of the MiCA rules will further streamline the regulatory changes.
Following regulatory clarity, the adoption of cryptocurrencies by German citizens will increase even further.
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