The Largest Bank in Germany Offers Bitcoin CS Storage Services to Clients!

JAKARTA - DZ Bank, one of the largest banks in Germany, has launched a digital custodian platform for institutional clients based on blockchain technology.

With this platform, clients store and manage digital assets, such as crypto, tokens or digital securities, for institutional or retail clients. Digital custodians typically use high levels of encryption and security technology to protect digital assets from theft, loss or damage.

The bank said it had conducted research and development on blockchain technology for several years before deciding to create a digital custody platform in 2022. "To operate the new custody solution, the bank has hired more than a dozen employees in IT, operations and compliance", the announcement said.

One of the digital assets that clients can hold is a crypto bond from Siemens, which is one of the first digital bond issuers in the world. This bond was issued on the Polygon blockchain with a volume of €60 million and a maturity of one year. These bonds were purchased by Union Investment and DZ Bank six months ago and can now be transferred to the digital custodian platform.

"We assume that in the next 10 years, most capital markets business will be processed through distributed ledger technology (DLT)-based infrastructure", said Holger Meffert, Head of Digital Securities and Custodian Services at DZ Bank. "In the medium term, we see DLT as a complementary technology to existing infrastructure in existing capital market processes", he added.

DZ Bank also revealed that it had applied for a crypto custody license from the Federal Financial Supervisory Authority (BaFin) in June. This license will allow the bank to provide cryptocurrency services such as bitcoin to institutional clients. The bank is also working on an offering that would allow private customers to invest directly in cryptocurrencies.

To develop the digital custodian platform, DZ Bank collaborated with Metaco, a provider of digital asset management technology and infrastructure. Metaco provides secure, flexible and integrated solutions for storing and managing digital assets.

DZ Bank is the largest cooperative bank in Germany and one of the largest banks in Europe. At the end of June, the bank's total assets reached €367.50 billion or equivalent to IDR 6.1 quadrillion and it had 5,411 employees. The bank is part of the Volksbanken Raiffeisenbanken network, which consists of around 800 local cooperative banks in Germany.