Deutsche Bank has revealed it is exploring options to start offering digital currency custody services as well as other crypto-specific services for institutional investors.
A spokesperson for Deutsche Bank tells AST: “We are looking at crypto custody. However, these discussions have just started and we haven’t made a formal decision yet."
Cryptocurrency has been on the rise as an asset class over the past few years and is attracting increased attention to the importance of security in this area.
Custody for cryptocurrencies, like bitcoin and ethereum for example, requires a different infrastructure from the traditional approach.
Aside from Deutsche Bank, other industry players like Onchain Custodian,Standard Chartered,Trustology, Gemini, Nomura, Ledger Vault, Hub Security and Marsh are involved in this increasingly popular area of finance.
The German bank has already shown an interest in the digital assets space with its recent collaboration with Singapore fintech Hashstacs in January.
Deutsche Bank and Hashstacs revealed they would explore a proof of concept related to the technological and practical feasibility of digital assets interoperability.
In December a report published by the World Economic Forum suggested that Deutsche Bank is aiming to develop a fully integrated custody platform for institutional clients and their digital assets providing seamless connectivity to the broader cryptocurrency ecosystem.
In the report, ‘Crypto, What Is It Good For? An Overview of Cryptocurrency Use Cases’, it noted that Deutsche Bank would launch its digital asset custody platform in stages.
The platform would provide insured digital asset custody for vetted digital assets on behalf of institutional investors, such as asset managers, wealth managers/family offices, corporates and digital funds.
It would also provide clients with the ability to buy and sell digital assets via a partnership with prime brokers, issuers and vetted exchanges to build out the seamless integration across platforms.
In addition, the platform would feature value-added services such as taxation, valuation services and fund administration, lending, staking and voting, and provide an open-banking platform to allow onboarding of third-party providers as well as providing issuance and trading capabilities.
The report also highlighted that Deutsche Bank would embed the platform with a full suite of regulated banking services including know-your-customer and anti-money laundering, compliance, settlement, among other features.
It suggested that Deutsche Bank has already “completed its proof of concept and is aiming for a minimum viable product in 2021 while exploring global client interest for a pilot initiative”.
