One of the largest banking institutions in Germany, the ‘Commerzbank’ has been trending in the news this morning, confirming that it applied for a local crypto license earlier this year, marking the first time a major bank has made a move toward cryptocurrencies in the country.
A representative from Commerzbank confirmed to local media outlet Börsen-Zeitung that it “applied for the crypto custody license in the first quarter of 2022.” If approved, the bank would be authorized to offer exchange services and custody and protection of crypto-assets.
The bank, with 18 million customers and over 70,000 institutional clients, has plans to target its institutional client base with its crypto offerings.
Mikkel Morch, Executive Director at crypto/digital asset hedge fund ARK36, has looked into this move and what it could mean for the country and the cryptocurrency sector,
“Reports of banks applying for a crypto license have cropped up recently in jurisdictions with progressive regulatory regimes that allow for it. Last week, such an application was submitted by a bank in Portugal. Now, one of the largest banks in Germany wants to offer crypto custody and exchange services. Where traditional and large banks until very recently have seen cryptos as competition and shied away from it, we now start to see adoption even from some of the most conservative players in the banking field.
These moves can be interpreted as the beginnings of a race within the traditional banking field to gain a competitive edge by being the first entity in its local market to offer crypto services. From both a technological and a marketing perspective, crypto has already become the next big thing, so to speak.
Inevitably, this will only speed up the adoption of crypto as a mainstream financial service. However, it also shows that the demand for it is already so high across the whole spectrum of banking clients that it compels entities that were previously hostile to crypto to completely change course. You cannot resist change and crypto is the change unfolding in real time.”
Worldwide, more and more big banks have recently decided to invest in crypto, as there is an opportunity for serious gains. With cryptocurrencies dominating an ever expanding sector of the economy, there is lots of potential for big earnings. Cryptocurrencies have proven to be quite stable over the long term now, and it is becoming more clear that crypto and blockchain are not going to go away any time soon anymore. It is now becoming evident that big institutions aren’t going to shy away from the potential gains, despite the volatility risks.