Deutsche Bank taps Swiss crypto firm Taurus for custody services

• Deutsche Bank will offer crypto custody services for institutional investors.
• Deutsche Bank in a World Economic Forum paper in 2020 expressed intentions of offering crypto trading.
• The bank has however clarified that it currently does not have plans to offer crypto trading.

Deutsche Bank has partnered with Taurus, a Swiss cryptocurrency firm, to offer digital assets and tokenized financial instruments custody services for institutional clients.

This collaboration marks a significant development as it enables Deutsche Bank to hold a limited selection of cryptocurrencies and tokenized versions of traditional financial assets on behalf of its clients, a capability confirmed by a Deutsche Bank spokesperson. However, the bank has clarified that it currently does not have immediate plans to engage in cryptocurrency trading, despite previously expressing such intentions in a World Economic Forum paper in 2020.

Crypto interest among institutional investors

The cryptocurrency market has faced challenges in recovering from a series of high-profile collapses among leading cryptocurrency firms in the past year, resulting in substantial losses for investors and calls for increased regulatory oversight from lawmakers worldwide.

Nevertheless, numerous mainstream financial institutions are exploring the potential application of blockchain technology, the underlying technology behind cryptocurrencies, for the trading and settling conventional financial assets. Notably, financial institutions like Standard Chartered, BNY Mellon, and Societe Generale already offer cryptocurrency custody services.

Paul Maley, Deutsche Bank’s global head of securities services, emphasized the growing importance of the digital asset space, expected to encompass trillions of dollars in assets, making it a priority for both investors and corporations.

The cryptocurrency market, as per CoinGecko data, is currently valued at approximately $1.1 trillion, down from its peak of just over $3 trillion in November 2021. Maley highlighted that their focus extends beyond cryptocurrencies, as they aim to support clients across the broader digital assets ecosystem.

Maley responding to US regulators’ caution about potential liquidity risks associated with cryptocurrency activities stated that Deutsche Bank is proceeding cautiously, aligning with the spirit and regulations governing this asset class. He emphasized that their product design and custody solutions are structured to mitigate the risk of impacting the bank’s other activities.