Deutsche Bank has applied for a digital asset custody license with BaFin as traditional finance (TradFi) companies use asset tokenization to quietly takeover the crypto industry.
The company seeks to diversify revenue streams while other crypto firms wait for Europe’s markets to take effect in the Crypto-Assets (MiCA) Bill.
Wall Street Firm Explores Asset Tokenization as Entry Point
The company revealed possible plans to launch a custody business in 2020.
Deutsche Bank is moving towards digital assets from a potential investment perspective. Its Singapore division recently tested a tokenized investment platform with the Memento blockchain.
TradFi firms are potential banking current Investment managers trust their brands when building crypto trading platforms. They have explored tokenization to indirectly expose customers to digital assets.
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Tokenization allows banks to manage illiquid, often tangible assets on the blockchain without a broker.
Citibank predicts that the total addressable market for tokenization will grow 80 times by 2030.
Last year, JPMorgan exchanged ERC-20 tokens for US dollars and Japanese yen through permissioned Aave pools.
BlackRock application will reveal whether the SEC will play favorites
Grayscale argued that the company’s exchange-traded fund (ETF) would use the same reference rate as the futures ETF the Securities and Exchange Commission (SEC) has already approved.
As a result, the SEC may either approve Grayscale’s application or revoke approval for existing products. Litigation is going on in the matter.
Asset management giant BlackRock recently requested permission to run a spot bitcoin ETF. This will designate Coinbase as the preferred digital asset custodian and benchmark bitcoin price using the CME CF rate.
Reputable crypto exchanges in the US set the rates on the CME.
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