Deutsche Bank, Germany’s largest bank, has taken a significant step into the world of crypto custody by applying for registration as a digital asset custody service provider.
This move comes as traditional financial institutions, including banks and asset management companies, increasingly recognize the potential of the digital asset sector. It reflects a broader shift in the financial landscape towards embracing cutting-edge technologies.
Deutsche Bank’s primary objective is to seek regulatory approval to offer custody services for digital assets, including cryptocurrencies. David Lynne, president of the bank’s commercial banking division, highlighted that the institution aims to establish a presence in the digital asset custody services market and expand its digital assets and custody business.
According to Lynne, this strategic move within Deutsche Bank’s corporate banking division is intended to enhance income fees. It also aligns with an earlier announcement by DWS Group, the investment division of Deutsche Bank, which entered into a contract earlier this year to generate revenue through digital asset-related services.
While the idea of venturing into digital assets and crypto custody has been under consideration within Deutsche Bank’s corporate banking division for nearly three years, the exact timeline for the commencement of custody services has not been disclosed. However, this application for registration signals a firm commitment to entering the digital asset custody space.
It’s worth noting that Deutsche Bank’s stance on Bitcoin has evolved over time. In its 2020 report, the bank referred to Bitcoin as “too volatile” and an unreliable store of value. However, its interest in digital asset custody indicates a recognition of the changing landscape and the potential opportunities in this emerging sector.
This news follows closely on the heels of BlackRock, the world’s largest asset management company, applying to launch a spot Bitcoin exchange-traded fund (ETF) in the United States. BlackRock’s move, if approved by the US Securities and Exchange Commission (SEC), could accelerate public adoption of cryptocurrencies by providing investors with access to these assets through a major player in the financial industry.
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