The pace of traditional finance (TradFi) institutions adopting cryptocurrencies is increasing rapidly around the world, fueled in part by anticipation surrounding Bitcoin‘s halving event. Notably, Germany’s largest federal bank, Landesbank Baden-Württemberg (LBBW), announced plans to collaborate with crypto exchange Bitpanda to provide crypto custody services.
Germany’s Top Bank and Bitpanda to Offer Crypto Custody
In the second half of 2024, Bloomberg announced that Germany’s largest federal bank, Landesbank Baden-Württemberg, and the Bitpanda crypto exchange will collaborate to offer cryptocurrency safekeeping services.
In simple terms, the leading German federal bank and the country’s biggest cryptocurrency exchange have formed an alliance, which is a significant step towards wider cryptocurrency acceptance before the implementation of MiCA regulations. Last November, the Austrian tech firm Bitpanda obtained a crypto license from Germany’s financial regulator (BaFin), enabling it to offer crypto custody and proprietary trading services.
Institutionally and corporately-sized clients can now avail of crypto custody services from LBBW and Bitpanda, as announced by both entities on April 15. LBBW, which is controlled by some German savings banks including Baden-Wuerttemberg and Stuttgart, holds approximately €333 billion ($355 billion) in assets.
“Jürgen Harengel, managing director of corporate banking at LBBW, stated that there is growing interest from our business clients for digital assets, including crypto. We believe that cryptocurrencies will become essential components in future business structures. Through this partnership, we aim to develop the necessary technical and regulatory frameworks early on to effectively assist our corporate clients in implementing their unique crypto strategies.”
Banks’ Active Participation in Crypto
The enthusiasm of German banks and financial institutions for cryptocurrencies is growing stronger as the European Union’s Markets in Crypto-Assets (MiCA) regulations approach their implementation later in 2023.
In March, Deutsche Boerse, a German stock exchange company, introduced the Deutsche Boerse Digital Exchange (DBDX) as a legally compliant and safe crypto trading platform. The objective is to provide institutional investors with a regulated and secure venue for executing trades, settling transactions, and safeguarding their digital assets.
In addition, there is significant interest in Bitcoin and other cryptocurrencies among both individual and institutional investors in Germany. The Xetra electronic trading platform caters to this demand by listing crypto Exchange-Traded Products (ETPs) and Exchange-Traded Notes (ETNs) from firms like 21Shares and WisdomTree.
According to a recent study conducted by KPMG, German investors have been increasingly purchasing cryptocurrencies, with the value of their trusts in these assets growing as the price of Bitcoin rises.
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2024-04-15 11:41