Doubts regarding crypto remain among German banks, but there is a growing concern about missing out on a potentially game-changing development.
For a long time, German banks largely neglected the cryptocurrency industry, considering it too speculative, too risky and too unregulated.
Foreign institutions, neobrokers, and crypto fintech companies such as Bitwala, Trade Republic, Bison App and Bitpanda were primarily responsible for providing services like trading and custody, business account management, tokenization, card issuing and ATMs.
Trading cryptocurrencies directly at a German bank branch is not possible. Not even the big online banks like Comdirect, Deutsche Kreditbank or ING allow their customers to trade cryptocurrencies directly via a broker. The only way for customers of these banks to invest in Bitcoin {BTC$25,904} and other coins is through certificates replicating the cryptocurrencies.
But German banks’ reluctance to embrace crypto is slowly ending, with more institutions working on solutions to give customers access to cryptocurrencies.
Bitcoin soon at 1,200 German banks?
Deutsche WertpapierServiceBank (Dwpbank) took an important step in March 2023 with the launch of its wpNex crypto trading platform, which gives 1,200 banks and savings banks in Germany access to the digital asset industry.
However, it remains to be seen how well affiliate banks will receive the offering and whether it will live up to expectations. “In addition to our pilot customer MLP Banking, we are also in close contact with DZ Bank [Germany’s second-largest bank by assets held] about our offer,” Heiko Beck, Dwpbank CEO, told Cointelegraph, adding that there are “a few other interested parties from the customer base,” without disclosing who.
Large commercial banks serve institutional clients
Asset management group DWS, which is majority-owned by Deutsche Bank, is also looking for a way into the crypto business by giving investors access to digital assets. In April, DWS announced it was working on exchange-traded products of cryptocurrencies in the European market with Galaxy Digital. Additionally, DWS intends to use the partnership to develop other digital solutions that will give investors access to blockchain applications and digital assets.
In an April LinkedIn post, DWS CEO Stefan Hoops said, “Without a doubt, the majority of crypto coins are between worthless and fraudulent,” adding, “Nevertheless, we believe in the future of a tokenized economy which will substantially disrupt the current market structure.”
The move follows the belief that investor interest in digital assets is unabated, according to Hoops, who added that “we should develop safe access to digital assets rather than display schadenfreude when our clients lose money dealing with dodgy [entities].”
