More Banks in Germany are Filing to Establish Crypto Custody Services
A report by news outlet Handelsblatt revealed that some banks have filed a request to establish a digital asset custody business.
Germany’s financial regulator BaFin noted the receipt of more than forty applications from parties who want to offer cryptocurrency custody services.
Germany reviewed its Money Laundering Act thereby permitting banks as well as other local financial institutions to offer and manage traditional securities (stocks and bonds inclusive), together with digital assets (BTC, ETH, and XRP).
The popularity of digital currencies increased during the previous few years. The cryptocurrency assets’ market is growing, surging to $288.3 billion while BaFin is dealing with anonymity and criminal activities involving these nascent assets, money laundering and global terrorists. According to BaFin, businesses must have an operational license to offer custody services.
The formulation of the new regulations by the German government came following the introduction of a fifth anti-money laundering directive (AMLD5) by the European Union. AMLD5 requires compliance with updated know-your-customer and AML processes.
According to FDP -Bundestagsabgeordnete Frank Schäffler, market growth is faster than anticipated by the Federal Ministry of Finance. More firms are demanding cryptocurrency custody licenses thereby showing increasing adoption of blockchain technology, and is likewise due to the new legislation, says Frank Schäffler.
Crypto-related firms have been directed by BaFin to establish compliance procedures to store cryptocurrency assets or to conduct businesses that deal with digital assets by Nov. 2020.
Featured image courtesy of Shutterstock. Source: Cryptopress.