Deutsche Bank, Germany's largest bank, has started a cryptocurrency custody service for institutional and corporate clients in Europe.
On Nov. 11 local time, blockchain media outlet Decrypt reported that Deutsche Bank formally launched its digital-asset custody service. It supports the storage and transfer of bitcoin and ether, as well as Circle's USDC and EURC and EURAU.
The service targets clients in Deutsche Bank's corporate banking and investment bank divisions. They include companies, asset managers, hedge funds, custodians, brokers and sovereign institutions. Deutsche Bank manages wallets and private keys on behalf of clients and is focusing at this stage on custody and transfer functions. Support for tokenised financial products remains a task for the future.
The bank also disclosed its security framework. Deutsche Bank said it applied hardware-based key protection, multi-approval procedures and a separate structure for warm storage and cold storage. It effectively underscored that the design targets institutional demand within a regulatory environment.
Paul Maley (폴 말리), head of global trust and securities services at Deutsche Bank, said it would build a fully integrated regulated ecosystem that supports custody, tokenisation and payments in the medium term. He said the goal is to provide a fully integrated regulated ecosystem that supports custody, tokenisation and payments for digital assets in the medium term.
Separately from the custody service, Deutsche Bank also signed a business agreement with Deutsche Asset Management. The two sides agreed to review cooperation in tokenised money market funds, crypto exchange-traded products and stablecoins. Deutsche Asset Management, previously known as DWS, manages about 1.22 trillion euros as of Sept. 30.
The launch is the result of years of preparation. Deutsche Bank has been preparing a crypto custody and trading platform since 2021 and applied for a digital-asset custody licence in Germany in 2023. Last year, there were also reports that it planned to build the service with technology from crypto exchange Bitpanda and with existing partner Taurus.
On the regulatory front, it received approval from Germany's financial regulator BaFin under the European Union's Markets in Crypto-Assets regulation, or MiCA. MiCA requires licensing for crypto service providers. Deutsche Bank drew a line, saying the custody service does not protect customers from digital-asset price volatility, fraud or the failure of other market participants.
Its push in crypto does not stop at custody. Deutsche Bank is also participating, along with global banks such as Goldman Sachs and Citi, in a $270 million stablecoin consortium. It has also said it plans to expand the custody service into Asia.
Deutsche Bank's launch aligns with a broader trend in which traditional finance's digital-asset business is moving further into the regulated mainstream within Europe's regulatory framework. For now it is focused on storage and transfers, but it remains to be seen whether the tokenised financial products and payment functions it has flagged will lead to actual services.
