Deutsche Bank is joining the ranks of Fidelity and BNY Mellon to offer institutional investors exposure to cryptocurrency, and may be eyeing Decentralized Finance (DeFi).
In an overlooked December report from the World Economic Forum (pointed out by CoinDesk this weekend), the financial juggernaut announced plans to launch the “Deutsche Bank Digital Asset Custody.” The first stage of the initiative will provide “vetted digital assets” to “target institutional investors, such as asset managers, wealth managers/family offices, corporates and digital funds.”
Once this stage is launched, the firm will allow other Deutsche Bank clients exposure to cryptocurrencies, and roll out taxation and valuation services. Unlike Fidelity Digital Funds, which is focusing exclusively on Bitcoin, Deutsche Bank Digital Assets Custody will handle “digital assets” as well as “lending, staking and voting”—popular concepts within the DeFi world wherein cryptocurrency holders can lend out digital assets and earn payments on the amounts they put up on exchanges.
The World Economic Forum report also points to other popular services in DeFi, including the decentralized cryptocurrency exchange Uniswap.
Deutsche Bank’s overview of the digital asset custody does not mention Bitcoin once, and says that it has completed a proof of concept of the program and is exploring “global client interest for a pilot initiative.”
Institutional investment firms have flocked to the cryptocurrency space in recent weeks. Bank of New York MellonCorp., the nation’s oldest bank, announced on Thursday plans to hold, transfer, and issue bitcoin to its asset-management clients.
“Digital assets are becoming part of the mainstream,” Roman Regelman, chief executive of BNY Mellon’s asset-servicing and digital businesses, told The Wall Street Journal last week.