Germany is one of many of countries actively working on regulations that will allow the cryptocurrency industry to evolve and flourish responsibly in the country. It is implementing policies and regulations for the space and encourages other countries to follow suit, especially those in the European Union (EU). While it asserts that Facebook’s Libra stablecoin has no place in the country (or anywhere else in the world), it is more than willing to embrace other digital currencies and is reportedly preparing new legislation that would allow banks to offer crypto trading and custody solutions.
As is the case in many other countries, banks in Germany cannot legally deal in crypto. A new bill has been introduced that would change this, allowing them to sell and buy digital assets, as well as to hold them for clients. The legislation has received approval from the country’s Bundestag, its federal parliament, and the next step is for all 16 German states to sign off on it before it becomes law.
The move has huge benefits for the crypto community – not just in Germany, but everywhere. If the country initiates the plan, citizens will be able to hold their digital assets in traditional banking facilities, giving those holders, and new ones, a greater sense of security. The Association of German Banks is supportive of the idea because, as it states, its members already know how to store and protect assets. They also know how to handle reporting criteria to ensure transactions meet with anti-money-laundering guidelines.
The response from the German crypto community has been generally supportive. The head of Distributed Ledger Consulting, Sven Hildebrandt, points out that it could have great benefits to crypto holders and users and adds, “Germany is well on its way to becoming a crypto-heaven. The German legislator is playing a pioneering role in the regulation of cryptocurrency.”
Not everyone is as convinced, however. Some believe that the banks might try to take advantage of less knowledgeable consumers and get them to engage in risky purchases without fully disclosing the downsides to crypto. Given that the financial institutions in Germany, just like in other parts of the world, are monitored and regulated, they would be forced to adhere to the same standards related to crypto transactions as they are conventional financial vehicles, so there isn’t much reason to believe the plan wouldn’t be successful all the way around.
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