Commerzbank Has Submitted Application For A Crypto Custody License.
Commerzbank, situated in Germany, is one of the first banks to offer digital asset-related services, announcing its application for a crypto custody business license from the country’s Federal Financial Supervisory Authority (BaFin).
Banking institutions are facing greater demand from clients to provide crypto-related services and investments in a safe and regulated manner as the cryptocurrency sector develops around the globe and across many industries.
Commerzbank, situated in Germany, is one of the first institutions to offer digital asset-related services, submitting its request for a crypto custody business license from the country’s Federal Financial Supervisory Authority (BaFin).
As first reported by Börsen-Zeitung on April 14, Commerzbank’s spokesman stated that the bank “applied for the crypto custody license in the first quarter of 2022.”
Indeed, the authority issues BaFin permits to financial firms that seek to store and exchange digital currencies for their customers. This license has been required for doing business with cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH) since January 1, 2020. (ETH).
The decision to operate regulated financial services without the required license can result in a criminal penalty of up to five years in prison for the individuals involved. The law does, however, provide for substantial transitional allowances for entities that were already conducting connected activities before the directive went into effect.
The anticipated crypto custody services will be offered mainly to institutional clients by Commerzbank, which serves over 28,000 corporate client groups and close to 11 million private and entrepreneurial clients in Germany.
It has joined a long list of organizations that have applied for the permission to become a crypto custodian. According to the financial authority, it has already received 25 license applications and has accepted four of them.
Coinbase was the first company to obtain a crypto custody license in Germany in January 2021. Commerzbank has become the first bank to apply for it.
Banks all across the world are increasingly interested in expanding their services to include cryptocurrency. Goldman Sachs is one among them, with plans to provide cryptocurrency services for its high-net-worth customers in the second quarter of 2022.
Furthermore, Blythe Masters of Credit Suisse, a board member and fintech expert, stated that Bitcoin was not a danger to fiat money or the banking sector. Crypto specialists, on the other hand, predict that cryptocurrency will render some banking services “irrelevant.”
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