A new legislation passed by the German parliament will allow banks in the country to sell and custody cryptocurrencies. The new law will be effective on January 1, 2020 and comes as an amendment to the fourth EU Money Laundering Directive.
The law initially required banks to seek third-party custodians but it’s final version will allow them to get a license to custody cryptocurrencies themselves. While some claimed the new legislation will allow Germany to become a cryptocurrency haven, others expressed concern when it comes to consumer protection, as people may invest in crypto via their banks, without understanding the risks.
A partner at Hamberg-based Distributed Ledger Consulting, Sven Hildebrandt, praised the new law as a step for Germany “to becoming a crypto-heaven.”
Hildebrandt said “The German legislator is playing a pioneering role in the regulation of crypto storage,”
“So far, distribution was only possible for the banks through special bonds. Here, they had to inform their customers in advance about costs and key investor information. This is not the case in direct sales of bitcoin and co,” Nauhauser told Handelsblatt.