Germany’s largest federal bank offers crypto custody services: Report
Update April 15, 11:30 am UTC: This article has been updated to include quotes from Bitpanda.
Germany's largest federal bank Landesbank Baden-Württemberg It will start offering cryptocurrency storage solutions in the second half of 2024.
The bank will start offering crypto protection services to institutional clients in partnership with Austria-based Bitpanda currency exchange.
Jürgen Harengel, managing director of corporate banking at Landsbank Baden-Württemberg, told Bloomberg that the German Federal Bank is seeing an increase in corporate demand.
“The demand for digital assets from our corporate clients is increasing.”
Landsbank Baden-Württemberg leverages Bitpanda's institutional security solution for the grant. Bitpanda Custody is a decentralized finance (DeFi) enabled crypto custodian platform registered with the UK's Financial Conduct Authority (FCA), according to Bitpanda's homepage.
The partnership will allow the bank to explore Bitpanda's digital asset platform, custodial services and related licenses, Gonzalo Llamas, Bitpanda's head of international relations, told Cointelegraph.
“As part of this collaboration, LBBW will use our “Investment-as-a-Service” infrastructure and services to source and provide security services for digital assets such as Bitcoin, Ethereum and others. The collaboration aims to enhance LBBW's digital asset offering, providing corporate clients with greater security and Innovation is about proving solutions.
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German banks will prepare for MICA regulations by the end of 2024.
Landsbank Baden-Württemberg is not the only German bank experimenting with crypto services. Deutsche Bank is working on digital asset custodial services from September 2023, tapping Swiss crypto startup Taurus for crypto wallet and token services.
In February, Germany's second largest bank, DZ Bank, announced plans to launch a crypto trading pilot in 2024. The bank announced its digital asset protection platform in November 2023
Banks in Europe's largest economy are preparing for the Market Regulation in Crypto-Assets (MiCA), which will become fully operational in December 2024 as the first comprehensive legal framework for the crypto industry.
Viara Savova, senior policy leader at the European Crypto Initiative, told Cointelegraph that crypto exchanges will become fully regulated entities from the end of 2024.
“2024 is the year of MiCA, and the entire EU will now have a common legal framework for crypto-assets, crypto-asset services and crypto-asset service providers (also known as CASPs). Crypto exchanges are a form of CASP under the MCA and will be fully regulated by December 2024.
The MiCA bill is still being finalized. The second consultation package under MiCA's reverse charge guidelines will be finalized on April 29. The outcome of the consultation will have implications for the final implementation of the MCA in December, Savova said.
“[The consultation will determine] How exchanges from countries outside the EU and other CASPs offer services to EU citizens without a license and how these services should be sold in Europe. The results of this consultation will be crucial to the implementation of the MICA in December.
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