Deutsche Bank, one of Germany’s leading financial institutions, has taken a significant step towards embracing the world of digital assets. According to a report released today by Bloomberg, the bank has officially applied for a digital asset license from BaFIN, Germany’s financial market regulator. If approved, this license would grant Deutsche Bank the authority to provide custody services for various digital assets, including cryptocurrencies.
During a recent conference, David Lynne, Head of Deutsche Bank’s Commercial Banking Unit, confirmed the news, stating, “We’re building out our digital assets and custody business.” Lynne added that the bank had submitted its application to BaFIN for the much-coveted digital asset license. This move represents a strategic decision by Deutsche Bank to expand its service offerings in response to the growing demand for digital assets among its clientele.
Deutsche Bank’s corporate division has been dropping hints about its intentions to enter the cryptocurrency industry since 2020. However, the bank has not previously provided a specific timeline for its foray into this rapidly evolving sector. Interestingly, in early 2020, a report published by a German bank criticised Bitcoin for its volatility and questioned its reliability as a store of value. Now, Deutsche Bank seems determined to explore the potential benefits of digital assets for its customers.
Elaborating on the bank’s motivation, Lynne explained that the corporate banking division’s interest in digital assets aligns with its broader strategy to boost fee income. The move mirrors the steps taken by Deutsche Bank’s investment arm, DWS Group, which has already started offering services linked to digital assets, resulting in increased revenue.
Deutsche Bank’s venture into the digital asset space follows in the footsteps of other major players in the banking industry. Recently, BlackRock, the world’s largest asset manager with over $10 trillion in assets under management (AUM), filed for regulatory approval to launch a spot Bitcoin exchange-traded fund (ETF) in the United States.
