Deutsche Bank Quietly Plans to Offer Crypto Custody, Prime Brokerage- CoinDesk


Deutsche Bank has joined the growing number of large financial institutions involved in cryptocurrency custody and is seeking to provide high-touch services to hedge funds investing in the asset class.

Deutsche Bank’s prototype of the Digital Asset Custody aims to “develop a fully integrated custody platform for institutional clients and their digital assets that provides a seamless connection to the broader cryptocurrency ecosystem,” according to a little-noticed report by the World Economic Forum, Host of the year collecting dung in Davos, Switzerland.

In a passage on page 23 of the December 2020 report, Germany’s largest bank plans to create a trading and token issuance platform that combines digital assets with traditional banking services and manages the range of digital assets and fiat stocks in a single step. platform to use.

Big banks are now announcing plans to enter crypto custody almost daily. The Bank of New York Mellon, the world’s largest custodian, is joining the party earlier this week.

The US banks received some regulatory clarity thanks to last year’s interpretive letters from the Office of the Comptroller of the Currency. In Germany, companies are waiting to receive special crypto custody licenses from the state’s supervisory authority, BaFIN.

The German, the 21st largest bank in the world, said it wanted to “ensure the security and accessibility of assets for customers by offering an institutional hot / cold storage solution with insurance coverage”. No specific cryptocurrencies or tokens are mentioned.

The digital asset custody platform would be rolled out gradually. Eventually, it would give customers the ability to buy and sell digital assets through partnerships with prime brokers (who act like concierges for hedge funds), issuers, and audited exchanges.

The bank says it would also “provide value-added services like tax, valuation and fund management, lending, staking and reconciliation, and provide an open banking platform to enable third-party onboarding.”

The service would be aimed at asset managers, asset managers, family offices, corporations and digital funds, according to the bank.

In terms of a business model, the bank would first charge custody fees and later charge fees for tokenization and trading.

The German announced that it has completed a proof of concept and is aiming for a product with minimal viability in 2021 while investigating global customer interest for a pilot initiative.

The bank’s press office could not be reached for comment on Friday evening. A spokesman had refused to comment on potential plans for a digital asset custody business when he was contacted by CoinDesk last week.