40 Banks in Germany Declare Intent to Offer Crypto Services Under New Law
More than 40 financial institutions in Germany have reportedly declared to the country’s financial regulator, BaFin, their interest to offer cryptocurrency services under the new German law. News.Bitcoin.com reached out to the regulator for some more information. The law, which went into effect early this year, enables banks to offer crypto services after obtaining a license from BaFin.
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Declaration Submitted by 40 Financial Institutions
BaFin has received more than 40 “expressions of interest” from banks for approval to operate a crypto custody business in the future, German publication Handelsblatt reported Monday.
News.Bitcoin.com reached out to BaFin for more details. A spokesperson for the regulator clarified that expressions of interest are not applications for permission. He explained that even before the new law came into force, BaFin had asked companies that were already providing crypto custody services and are therefore subject to BaFin’s mandatory authorization to submit informal, non-binding expressions of interest. The spokesperson, however, would not comment on the number of banks that have submitted this expression of interest.
The new German Money Laundering Act which went into effect at the beginning of the year allows financial institutions to offer their customers cryptocurrencies alongside traditional investment products, such as stocks and bonds.
Expressions of Interest to Offer Crypto Services
BaFin explained that companies will not receive an immediate acknowledgment of receipt or an assessment of the information submitted on their expression of interest. This voluntary action does not replace the formal notification of intent pursuant to Section 64y KWG, the regulator noted, adding:
The law implementing the amendment to the Fourth EU Money Laundering Directive … came into force on January 1, 2020 … These companies are therefore subject to money laundering law from 01.01.2020 regardless of the time of submitting the notification of intent.
One of the first financial institutions to offer cryptocurrency services is Solarisbank in Berlin. The bank launched a subsidiary, Solaris Digital Assets, in December last year to drive the adoption of digital assets. “As a subsidiary of Solarisbank AG, Solaris Digital Assets plans to fulfill the regulatory requirements of the German market and ensure the compliant storage of digital assets, so that partners do not have to apply for a license themselves,” the company affirmed at the time. In the event of a successful application for a custody license from BaFin, the bank plans to store bitcoin and other cryptocurrencies on behalf of the customer, Handelsblatt conveyed.
Solarisbank has a full banking license and has been providing services to numerous German fintech startups. “Digital assets will fundamentally change the financial market,” Michael Offermann, Managing Director for crypto banking activities at Solarisbank, told the news outlet. “As soon as it becomes easier to buy and store bitcoin … we expect strong growth.” He elaborated:
We have been dealing intensively with the topic of crypto custody for a year and a half … The new regulation in the new Money Laundering Act is a good time to start practically. After all, we are not a research institute, but a commercial bank.
What do you think of all these banks eager to offer crypto services? Let us know in the comments section below.
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