Until now banks have not been allowed to offer direct access to crypto assets. However, a new law that will be implementing the fourth EU Money Laundering Directive will change that in 2020.
According to a local German newspaper on Wednesday, the bill has already been passed by the government and it expected to be signed off by the nation’s 16 states.
Originally it was not planned that banks would be allowed to act as crypto custodians and the plan was that they should rely on external custodians or dedicated subsidiaries.
The head of the consulting firm DLC, Sven Hildebrandt, welcomed the news saying that “Germany is well on its way to becoming a crypto-heaven. The German legislator is playing a pioneering role in the regulation of [crypto assets]. “
The German banking association. BdB felt that “Credit institutions are experienced in the safekeeping of client assets and in risk management, are committed to investor protection and have always been controlled by the financial supervision.” Doing this, banks could indeed prevent the laundering of money and the financing of terrorists with crypto assets.
Furthermore, the incoming bill would enable investment in cryptos via German-based funds, instead of forcing people to put their money abroad. Concerns included perceived threats to the protection of consumers. A financial expert at the consumer center in Baden-Wuerttemberg, told the newspaper: “If banks are allowed to sell cryptocurrencies and keep them for a fee, they run the risk of turning their assets at risk of total loss to their clients, without them knowing what they are getting into.