Europe’s Largest Traditional Banks Venturing into Crypto Thanks to MiCA

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Some European banks are now attempting to join the cryptocurrency market as clear regulations, specifically the MiCA (Markets in Crypto-Assets) laws, have been adopted. In a recent conversation, Lukas Enzersdorfer-Konrad, Bitpanda’s deputy CEO, explained that this interest is driven by the legislation’s transparency.

European banks are embracing cryptocurrencies as an investment option and adopting tokenization technology due to MiCA, the imminent European regulatory framework, which provides clear guidelines for banks in this area. (Or) The clarification brought about by MiCA, the upcoming European regulation for banks, is prompting European banks to explore crypto assets and tokenization tech as viable investment options.

Europe’s MiCA Is Spurring Traditional Institutional Interest in Crypto

With MiCA’s approval, traditional banks have become more open to offering crypto services. However, lacking the necessary expertise and resources, they are seeking collaborations with skilled organizations to help them deliver these new offerings.

Bitpanda teamed up with Raiffeisen, Austria’s largest community bank, to bring cryptocurrency services to their retail clients. Last year, they revealed their intentions to assist customers in building a strong financial foundation through various offerings such as commodities, stocks, ETFs, and precious metals.

Likewise, Landesbank Baden-Württemberg (LBBW), Germany’s largest federal bank, revealed crypto custody plans in collaboration with Bitpanda last week. From the second half of this year, LBBW will provide institutional clients with crypto custody services. According to Jürgen Harengel, Managing Director of Corporate Banking at LBBW, who spoke with Bloomberg, the bank is addressing the growing need from its corporate clientele for such offerings.

Bitpanda’s Enzersdorfer-Konrad says banks now see realizing the need to find a crypto partner:

In a surprising turn of events, banks have come to recognize the need for technical expertise and internal knowledge in the realm of crypto services. Due to time and financial constraints in the past, they hadn’t prioritized building this capability internally. Now, however, there is a pressing demand to offer crypto-related products or services to their customers. Banks of all sizes across Europe – from large tier one institutions to smaller tier three banks – are actively seeking out crypto service providers and use cases to help them get started.

More ETFs

European institutions may be drawn to crypto services due to the recent approval of spot Bitcoin and Ethereum ETFs in the United States. Following the SEC’s approval in January, the market has seen a significant influx of funds, leading other jurisdictions to make similar moves. Last week, Hong Kong’s Securities and Futures Commission gave the green light to these products, making it the first to do so before the US. The two companies granted approval are the Hong Kong branch of China Asset Management and Harvest Global Investments.

An extra approval, conditional in nature, was given by the Securities and Futures Commission (SFC) to Hashkey Capital and Bosera Asset Management, the Hong Kong offshoot of a significant Chinese asset manager, for managing two Bitcoin and Ethereum crypto ETFs. These two entities will work together to introduce the Bosera HashKey Bitcoin ETF and the Bosera HashKey Ether ETF, both being spot exchange-traded funds. By investing in these ETFs, investors can easily purchase shares using Bitcoin and Ethereum directly.

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2024-04-23 18:07