In a groundbreaking move, Deutsche Bank, the largest bank in Germany based on total assets, has reportedly applied for regulatory permission to operate as a crypto custodian. This development comes as the financial institution aims to tap into the growing demand for digital asset storage and bolster its fee income.
The bank’s application, submitted to the Federal Financial Supervisory Authority (BaFin), seeks to establish a “digital assets and custody business” within its operations. With millions of customers and total assets surpassing $1.4 trillion, Deutsche Bank’s entry into the crypto custody sector carries significant implications for the broader financial landscape.
David Lynne, a member of Deutsche Bank’s Group Management Committee, confirmed the application and highlighted its alignment with the institution’s strategic objectives. Lynne emphasized that the move mirrors the efforts of Deutsche Bank’s asset management arm, DWS Group, which has expressed its intentions to invest in cryptocurrency firms, including Deutsche Digital Assets (DDA) and Tradias. Additionally, a potential collaboration with Galaxy Digital, a prominent crypto-focused financial services company led by Bitcoin advocate Mike Novogratz, is being considered.
Deutsche Bank Looking to Match Rivals in Crypto Adoption
Deutsche Bank’s foray into crypto custody follows in the footsteps of its German rival, DZ Bank. As the central institution of the Volksbanken Raiffeisenbanken Cooperative Financial Network, DZ Bank has already made strides in the digital asset custody arena. Earlier this year, it formed a partnership with Swiss firm Metaco and orchestration platform Harmonize, enabling the provision of crypto custody services to institutional clients.
These recent developments from both Deutsche Bank and DZ Bank underscore the growing recognition of cryptocurrencies and the demand for secure custodial solutions. As traditional financial institutions venture into the crypto space, the convergence of traditional banking services with digital assets is likely to further accelerate, potentially paving the way for increased institutional participation in the cryptocurrency market.
