According to a statement issued by Taurus on Thursday, Deutsche Bank has entered into a partnership with the Swiss cryptocurrency business Taurus to provide custody services for the cryptocurrencies and tokenized assets of institutional clients.
Because to this relationship, Deutsche Bank will, for the first time, be able to store a limited number of cryptocurrencies and tokenized versions of traditional financial assets for the benefit of its customers, according to a spokeswoman for the bank.
The representative for the bank stated that the bank does not have “immediate plans” to engage in cryptocurrency trading. In a report presented at the World Economic Forum in 2020, Deutsche Bank stated that it planned to begin offering cryptocurrency trading.
The crypto markets have had a difficult time recovering from the string of collapses that occurred at big crypto firms in 2018. These failures resulted in significant losses for investors and prompted lawmakers from around the world to advocate for increased regulation. Blockchain, the technology that underpins cryptocurrencies, is being discussed by a number of conventional financial institutions as a potential solution for the trading and settlement of traditional financial assets.
There are a number of financial institutions, such as Standard Chartered, BNY Mellon, and Societe Generale, who provide custody services for cryptocurrencies.
According to Paul Maley, global head of securities services at Deutsche Bank, “as the digital asset space is expected to encompass trillions of dollars of assets, it’s bound to be seen as one of the priorities for investors and corporations alike.”
According to data provided by CoinGecko, the value of the cryptocurrency market is currently somewhere around $1.1 trillion, having dropped from a record of slightly above $3 trillion in November 2021.
“Our focus is not just on cryptocurrencies, but rather supporting our clients in the overall digital assets ecosystem,” Maley explained further.
U.S. regulators have issued a warning to the nation’s banks, advising them to be on the lookout for potential liquidity risks posed by customers dealing with cryptocurrency.
According to Maley, Deutsche Bank is acting “cautiously and in line with the spirit and the letter of the regulations governing this asset class.”
In his words, “Our product design, and the nature of custody for clients, will make sure that there isn’t the risk of contaminating the bank’s other activities,” and this is exactly what he claimed.