Deutsche Bank Goes Live With Crypto Custody After a Five-Year Buildup

In brief Deutsche Bank’s Digital Asset Custody service is live for paying institutional and corporate clients in Europe, supporting Bitcoin, Ethereum, USDC, EURC and EURAU. The bank signed a memorandum of understanding with Deutsche Asset Management to explore tokenized money market funds, crypto ETCs and stablecoins. The launch follows years of preparation and BaFin authorization under MiCA, and the bank is also part of a $270 million stablecoin consortium. Five years after it first floated the idea, Germany’s largest lender is now holding Bitcoin for clients.Deutsche Bank said Wednesday that its Digital Asset Custody service has gone live for paying clients, giving institutional and corporate customers in Europe a regulated way to store and transfer Bitcoin, Ethereum and three stablecoins: Circle’s USDC and EURC, plus EURAU.The bank manages wallets and private keys on clients’ behalf. For now, the service covers custody and transfers, with tokenized financial instruments on its roadmap.The service is aimed at clients of Deutsche Bank’s corporate and investment banking units, including corporations, asset managers, hedge funds, custodians, brokers and sovereign institutions, according to the bank’s September announcement of the plan.Its setup includes hardware-based key protection, multi-person approvals and separate warm and cold storage, the bank said.“In the medium term we aim to deliver a fully integrated, regulated ecosystem that supports the custody, tokenisation, and settlement of digital assets,” said Paul Maley, Deutsche Bank’s global head of trust and securities services.Deutsche Bank also signed a memorandum of understanding with Deutsche Asset Management, the majority-owned money manager formerly known as DWS, to explore working together on tokenized money market funds, crypto exchange-traded commodities and stablecoins.The asset manager oversaw about 1.22 trillion euros as of Sept. 30. The bank has also said it plans to expand the custody service to Asia.The launch caps a long road, going back to at least 2021 when Deutsche Bank began readying a crypto custody and trading platform. Then, in 2023, the bank applied for a digital asset custody license in Germany. Last year, reports said the bank planned to build the service with technology from crypto exchange Bitpanda, alongside its longtime partner Taurus.Deutsche Bank received authorization from German regulator BaFin under the EU’s Markets in Crypto-Assets regulation, or MiCA, which requires crypto service providers to be licensed. The bank cautioned that its custody service doesn’t protect clients against swings in the value of digital assets, fraud or failures by other market participants.The custody launch isn’t Deutsche Bank’s only crypto bet. The bank is among a group of global lenders, including Goldman Sachs and Citi, backing a $270 million challenge to crypto’s dominant stablecoin issuers.Daily Debrief NewsletterStart every day with the top news stories right now, plus original features, a podcast, videos and more. Join 72,000+ readersCreate an account to save your articles.