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Germany’s Bitcoin Group Welcomes Licensing for Crypto Custodians, Expects Competition From Banks


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Germany’s Bitcoin Group Welcomes Licensing for Crypto Custodians, Expects Competition From Banks

Bitcoin Group SE, a prominent member of the European crypto industry, has been preparing to apply for permission to conduct crypto custody activities in its home country, Germany. The providers of such services in the Federal Republic are now recognized as financial institutions. Bitcoin Group, which has been in the business for some time, welcomes the changes that introduced licensing to the sector. Starting from Jan. 1, 2020, banks and other institutions are allowed to store and manage clients’ crypto assets.

Also read: Bitcoin Is Financial Instrument, Clarifies Germany, Crypto Custodians Qualify as Financial Institutions

Bitcoin Group Confirms Plan to Obtain Crypto Custody Permit

As the organization behind one of the largest crypto trading platforms in Europe, Bitcoin Group SE has already established itself as a major custodian of digital assets in Germany. Its fully owned subsidiary, Bitcoin Deutschland AG, operates Germany’s leading regulated marketplace for cryptocurrencies such as BTC, BCH and ETH. The investment group is also owner of Futurum Bank AG and holds 50% of the shares of Sineus Financial Services GmbH, an entity supervised by the German financial watchdog, Bafin.

Germany’s Bitcoin Group Welcomes Licensing for Crypto Custodians, Expects Competition From BanksThe Federal Financial Supervisory Authority of Germany approved the acquisition of Futurum Bank in July 2019.

In December, Bitcoin Group announced it plans to apply for crypto custody permission for its companies from the Federal Financial Supervisory Authority. It hopes to expand its positions in the market for these types of services and the acquisition of Futurum Bank AG, which was approved by Bafin, creates new opportunities to attract institutional clients. Securing a license became necessary following last year’s adoption of legislation transposing EU’s Fourth Anti-Money Laundering Directive into national law.

The new regulations entered into force on Jan. 1, 2020. The German Banking Act now defines crypto custody business as the safekeeping and managing of crypto assets ​​or private cryptographic keys that serve to hold and store crypto assets that can be transferred to others. In recently published guidance, Bafin clarified that these activities represent financial services. Financial institutions had until the end of March to declare intent to obtain a license and the deadline for filing an application is Nov. 30.

Speaking to news.Bitcoin.com, Bitcoin Group Managing Director Marco Bodewein confirmed that the holding company is going to apply for a crypto custody license and explained:

Due to the current requirements of the authorities, the final application needs to be filed by November 2020 but we will apply officially much earlier. As of now we do not see any challenges for Bitcoin.de at all as we are already in the custody business for several years.

German Banks Are yet to Enter Cryptocurrency Market

Bodewein added that Bitcoin Group welcomes the current development of the regulatory regime in Germany which will open the market for more players including banks entering the crypto space. Competition is usually good for the business, he emphasized, although his crypto company has not yet experienced any stiff competition from traditional financial institutions.

The executive said that Bitcoin Group would also appreciate the adoption of regulations at EU level. “Certainly, the German approach is the first within Europe so it might be possible that Germany created a blue print for the rest of Europe,” Marco Bodewein commented.

Germany’s Bitcoin Group Welcomes Licensing for Crypto Custodians, Expects Competition From BanksThe European Commission is gathering feedback from EU citizens, businesses, and regulators to establish a common regulatory framework for crypto assets and markets.

According to the latest corporate results published in September, Bitcoin Group’s earnings before interest and taxes amounted to €4.228 million in the first half of 2019. During the same period, Bitcoin.de reported an increase in its customer numbers to 808,000 registered users, up from 753,000 at the end of H1, 2018.

Bitcoin Group believes the growth is largely due to the expansion of the range of services provided by the exchange including the launch of a mobile app. The acquisition of Futurum Bank, formerly investment bank Tremmel Wertpapierhandelsbank GmbH, will mow allow the holding to offer new products related to cryptocurrencies, carry out proprietary trading and operate a network of Bitcoin ATMs.

How do you think Germany’s new regulations will affect the crypto industry in Europe? Share your thoughts on the subject in the comments section below.

Disclaimer: This article is for informational purposes only. It is not an offer or solicitation of an offer to buy or sell, or a recommendation, endorsement, or sponsorship of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Images courtesy of Shutterstock.

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The post Germany’s Bitcoin Group Welcomes Licensing for Crypto Custodians, Expects Competition From Banks appeared first on Bitcoin News.

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