Commerzbank, a leading banking institution in Germany, has applied for a local crypto license. The license was applied for earlier in the year, making it the first time a large bank in Germany is moving toward the cryptocurrency industry.
Commerzbank files for crypto license
A publication by a local media outlet cited a spokesperson from the bank who revealed that the company had applied for a crypto custody license during the first quarter of 2022. The licensing application was filed with BaFin, and if it is approved, it will authorize the bank to offer cryptocurrency exchange services while offering custody and protection of digital assets.
Commerzbank is one of the largest banks in Germany. The bank has more than 18 million customers and more than 70,000 institutional clients. The spokesperson said that if the license is approved, the crypto service offerings will target institutional investors.
BaFin is currently the regulatory body with oversight over cryptocurrency businesses in Germany. The regulatory body was tasked with approving businesses that wanted to offer crypto services in Germany. BaFin has so far approved only four companies, with more than 25 applications still pending approval.
The first institution to be approved by BaFin was Coinbase Germany. The institution was approved by the regulatory body in June 2021. Upvest, a financial technology firm based in Berlin, was the latest firm to gain approval in March.
Commerzbank has been an active participant in the cryptocurrency space. The banking giant first ventured into blockchain projects in 2018. In 2019, it conducted several transactions using a distributed ledger technology (DLT) lending protocol. The transactions were made with other leading banks.
Last year, Commerzbank secured a strategic partnership deal to create digital marketplaces on blockchain. The marketplace sought to support traditional asset classes such as real estate and art.
Crypto regulations in Germany
European countries have been slow in boosting the adoption of cryptocurrencies due to the lack of a clear regulatory framework. However, Germany has stood out as more crypto-friendly compared to its neighbours. In 2021, the country proposed several reforms and regulations to boost the adoption of cryptocurrencies and blockchain technology.
Investors in Germany have also diversified their investment portfolios with crypto assets. Last month, KuCoin released survey results showing that 44% of German investors were willing to invest in cryptocurrencies, while 37% of German crypto investors had traded crypto for more than a year.
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