Deutsche Bank Crypto Dive: Seeks Regulatory License For Digital Asset Custody Services

In a bold move to diversify its revenue streams and tap into the growing crypto market, Deutsche Bank, Germany’s largest banking institution, has submitted an application to the German Federal Financial Administration (Bafin) for a regulatory license to offer custody services for cryptocurrencies.

The bank’s strategic foray into the world of digital assets is part of its broader plan to boost fee income within its corporate banking division.

With total assets amounting to a staggering EUR 1.337 trillion in the fourth quarter of 2022, Deutsche Bank has long been recognized as a formidable player in the financial industry.

Now, it aims to capitalize on the burgeoning popularity of cryptocurrencies and provide its clientele with a secure and reliable platform to store and manage their digital assets.

David Lynne, the head of Deutsche Bank’s commercial banking unit, announced the institution’s intentions during a recent conference, stating:

We’re building out our digital assets and custody business. We just put our application into Bafin for the digital asset license.

He was referring to Bafin, Germany’s securities watchdog responsible for regulating financial institutions.

This move follows the footsteps of Deutsche Bank’s investment arm, DWS Group, which has also been exploring opportunities to expand its revenue streams by offering products and services related to digital assets.

The bank aims to leverage its extensive expertise and market presence to cater to the increasing demand for secure and efficient cryptocurrency custody solutions.

Deutsche Bank’s corporate banking division had initially hinted at plans to enter the digital asset custody market back in late 2020. However, specific details regarding the timing of the service launch remained undisclosed.

The division was formerly led by Stefan Hoops, who assumed the role of CEO at DWS Group a year ago, paving the way for David Lynne to take over.

Revenue Concerns In Deutsche Bank’s Investment Bank Division Amid Crypto Ventures

Recent news regarding Deutsche Bank’s investment bank division suggests a challenging second quarter. During a recent financial conference, James von Moltke, the bank’s finance chief, revealed that the division’s revenue is likely to decrease by at least 15% compared to the same period last year. This projection surpasses the expectations of analysts, who had previously estimated a 10% drop.

Nevertheless, von Moltke expressed optimism about the bank’s outlook, describing it as “reasonably favorable.” Deutsche Bank remains committed to navigating the evolving financial landscape and adapting its business strategies to capture new opportunities, such as the emerging market for digital assets and cryptocurrencies.

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