Deutsche Bank partners with Taurus for crypto custody and tokenization.

Deutsche Bank partners with Taurus for crypto custody and tokenization.

Deutsche Bank Collaborates with Taurus to Establish Digital Asset Custody and Tokenization Services

Deutsche Bank, the largest bank in Germany, has recently announced its collaboration with Taurus, a Swiss startup specializing in cryptocurrency safekeeping. The partnership aims to establish digital asset custody and tokenization services for corporate and institutional clients. In pursuit of this, Deutsche Bank applied for a crypto custody license from Germany’s financial watchdog, BaFin, earlier this year.

The move by Deutsche Bank is part of its broader ambitions in the digital asset custody space. In fact, the bank’s interest in crypto custody was first revealed in early 2021 when details of a digital asset custody prototype were included in a report published by the World Economic Forum. This demonstrates the growing recognition by traditional finance firms like Deutsche Bank of the potential opportunities presented by the digital assets industry.

A key catalyst for Deutsche Bank’s foray into the crypto custody space is Germany’s rollout of regulations for firms to custody crypto assets. These regulations, combined with Europe’s proposed regime for Markets in Crypto-Assets (MiCA) regulation, have provided the necessary clarity and regulatory framework for traditional finance firms to explore digital assets. This development has paved the way for strategic partnerships such as the one between Deutsche Bank and Taurus.

Deutsche Bank’s investment in Taurus further solidifies its commitment to the digital assets industry. The bank participated in Taurus’ $65 million Series B funding round, led by Credit Suisse and featuring other notable investors such as Arab Bank Switzerland and Pictet Group. This investment not only strengthens the collaboration between Deutsche Bank and Taurus but also signifies the bank’s confidence in Taurus’ expertise in the crypto custody space.

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According to Lamine Brahimi, co-founder of Taurus, Deutsche Bank’s due diligence process began at the end of 2021 and concluded in 2022, resulting in the bank becoming a client of Taurus and subsequently deciding to take a stake in the company. While the initial focus of the partnership is on cryptocurrencies, Brahimi emphasizes that Taurus is known for going beyond just cryptocurrencies. The collaboration enables Deutsche Bank to tokenize assets and provide asset servicing where appropriate, indicating the bank’s interest in exploring the broader spectrum of digital assets.

As the global head of securities services at Deutsche Bank, Paul Maley, explains, the plan is to develop digital asset custody services for a wide variety of digital asset types. Initially, the bank will offer custody services for selected cryptocurrencies and stablecoins. However, Maley acknowledges the potential in the broader emergence of tokenized financial assets. This highlights the bank’s forward-looking approach to the evolving landscape of digital assets.

Furthermore, Maley acknowledges the differences in regulations across jurisdictions. While the United States has been slower in implementing regulations, he notes that the emergence of regulation outside of the U.S., particularly in Europe and Asia, has provided market participants with greater clarity. This observation highlights the need for consistent and comprehensive regulatory frameworks to foster innovation and growth within the digital assets industry.

In summary, Deutsche Bank’s collaboration with Taurus to establish digital asset custody and tokenization services signifies the bank’s recognition of the potential of the digital assets industry. By leveraging Taurus’ expertise in cryptocurrency safekeeping, Deutsche Bank aims to provide custody services for selected cryptocurrencies and stablecoins, while also exploring the broader realm of tokenized financial assets. This partnership is accelerated by the regulatory developments in Germany and Europe, which provide the necessary clarity for traditional finance firms to actively participate in the digital assets space. As the industry continues to evolve, collaborations like these will play a crucial role in shaping the future of the blockchain industry.

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