According to a press release today, Commerzbank, a Frankfurt-headquartered global bank, has obtained a crypto custody license in Germany.
Following the development, the bank claims it is the first full-service German bank to obtain this license in the country under the German Banking Act (KWG) legal framework.
Notably, the license will allow Commerzbank to offer a variety of digital asset services, especially those related to cryptos.
Commenting on the development, Commerzbank’s COO, Dr Jörg Oliveri del Castillo-Schulz, described the license as an important milestone for the company. Additionally, he mentioned that the license establishes the foundation of the bank’s commitment to offer digital asset services to its customers.
Per Commerzbank, the next step after obtaining the license is establishing a reliable and secure platform that complies with local regulations.
According to the bank, this platform will provide blockchain-based crypto asset custody services.
Challenges in Obtaining Crypto Licenses in Germany
It is worth noting that companies looking to obtain a crypto license in Germany have faced intense scrutiny from the country’s financial markets regulator, BaFin.
This is majorly due to the regulator’s cautious approach towards granting the necessary approval. According to reports, the authorities denied Binance’s request to obtain a crypto custody license in the country, prompting the world’s largest exchange to withdraw its application.
However, Commerzbank’s bid to offer crypto-related services in Germany was granted, making it the first full-service bank to receive this license, the bank boasts.
Traditional Financial Institutions Offer Crypto-Related Services
The development comes in the wake of growing demand for crypto and digital assets. Financial institutions are making significant efforts to offer crypto-related services to their customers, especially institutional clients seeking exposure to the nascent asset class.
As reported by The Crypto Basic, Germany’s largest banking institution, Deutsche Bank, partnered with Swiss-based digital asset custodian Taurus to allow its customers to store crypto and other digital assets.
In a similar development, U.S.-based BNY Mellon collaborated with Fireblocks to provide custody services for its customers’ Bitcoin and Ethereum.