Frankfurt-based Commerzbank AG has received approval from German regulators to run a crypto custody business. According to a statement released today, the bank will focus on crypto assets as the demand for the safekeeping of tokenized assets grows.
Commerzbank received a green light to offer crypto custody services after the German regulator approved its expanded license. The agency recently said that so-called full-service banks like Commerzbank must get an expanded license to offer digital asset services.
German Banks Cites Custody Demand
The new license gives European banking regulators insight into how banks are running their digital asset businesses. Another German lender, DZ Bank AG, said it started its digital asset custody platform. Deutsche Bank AG also recently acquired a custody license.
DZ Bank AG and French Bank Société Générale said their crypto licenses are in response to demand. Sygnum Bank in Singapore also recently acquired a license for crypto custody and brokerage services to cope with increasing demand.
Demand for digital asset custody is increasing with the passage of regulations to safeguard the assets of customers of crypto exchanges. An emerging use case is also the custody of tokenized real-world assets, a relatively new industry that represents real-world assets on a blockchain. Swarm, a fully regulated decentralized finance company, keeps tokenized financial instruments with custodians like Gemini or Coinbase before transferring them to a buyer.
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Author: David Thomas
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