The German
financial market regulator wants to accelerate its current approach to
licensing crypto custody services. The announcement, made by BaFin President
Mark Branson during the Handelsblatt Banking Summit in Frankfurt, comes as part
of a broader effort to instill trust and transparency in the rapidly evolving
crypto asset market. The new policy has implications for crypto custody
providers and sets the tone for future regulatory developments in Germany.
Amid
increasing volatility and skepticism in the crypto markets, Germany’s
regulatory body for financial institutions (BaFin) new licensing approach aims
to instill a sense of trust among investors. According to Branson, regulated
players in Germany are gaining market share as consumer apprehension in the
crypto markets increases. The regulatory body’s latest actions reassure
investors that their assets will be handled with integrity.
The first
eight months of 2023 saw BaFin complete twice as many application processes for
crypto custody licenses as the previous year. This uptick in regulatory
activity shows a keen awareness of the need for stronger oversight in a growing
market. BaFin’s President ensures that only companies with a plausible business
model, sufficient start-up capital, and reliable management staff receive
permission to operate.
“In
recent months, we have also picked up the pace in issuing crypto custody
licenses and in…
