Next year German banks will be able to manage cryptocurrencies like bitcoin after the fourth EU money laundering directive goes into effect. The directive passed in the German parliament, Bundestag, allows banks in the country to act as cryptocurrency custodians rather than rely on third-party custodial services.
German Banks Will Soon Be Able to Manage Cryptocurrencies
According to the regional financial news publication Handelsblatt, in 2020 banking institutions from Germany will be able to manage cryptocurrencies for customers. Under newly enacted legislation, banks in Germany will be able to receive, store, and sell digital assets like bitcoin cash (BCH) and ethereum (ETH). Directive 2015/849 is an amended regulatory approach that was issued by the European Parliament and German politicians. The fourth EU money laundering directive highlights the fact that “electronic money products is increasingly considered to be a substitute for bank accounts.” Handelsblatt reporter Felix Holtermann reveals that the new directive’s “deletion of the so-called separation bid” makes it so German banks can handle cryptocurrencies without needing to use a third-party custodian. Prior to erasing this part of the guidelines, the directive would have required banks to use “external custodians or special subsidiaries” to store the cryptocurrencies.
In 2020, German banks will be able to offer cryptocurrency solutions alongside bonds, equities, and traditional stocks. The banks will need to procure a license to offer digital asset custodial services, but the directive extends application deadlines. The consulting firm DLC’s executive Sven Hildebrandt believes the initiative puts Germany ahead of the game. “Germany is well on its way to becoming a crypto-heaven,” Hildebrandt remarked. “The German legislator is playing a pioneering role in the regulation of cryptocurrencies.” The