Deutsche Börse AG (ETR: DB1), a leading European stock and securities trading firm based in Germany, has announced plans to launch a cryptocurrency exchange in 2024. Amid crypto regulatory implementation in Germany and the larger European market, Deutsche Börse intends to introduce a regulated cryptocurrency exchange for both institutional clients and retail traders.
According to the company’s head of trading and clearing Book, the launch of a regulated cryptocurrency exchange is part of the plan to venture into the digital asset industry to ensure future growth prospects. Moreover, the company has made several strategic crypto investments in the past and has identified a potential niche in the exchange space.
Reportedly, the company will also launch a regulated stablecoin in a bid to facilitate seamless clearing of digital assets trading on its platform. The cryptocurrency exchange by Deutsche Börse is also expected to deal with tokenized assets running on different blockchains. Furthermore, real-world asset tokenization has been identified as a crucial component of the mainstream adoption of blockchain technology. Additionally, asset tokenization has significantly helped democratize the stock market which was mostly locked to specific geolocations.
With a regulated cryptocurrency exchange backed by a reputable stock clearing firm, more cash flow is expected for the digital asset industry in the coming years. Already, Deutsche Börse has a digital post-trade dubbed D7, which has so far issued 4,000 digital securities worth more than €3 billion. Some of the D7 customers include Commerzbank AG (ETR: CBK), DekaBank, Vontobel Holdings AG (SWX: VONN), and LBBW, among others.
Deutsche Börse and the Cryptocurrency Market Outlook
The cryptocurrency market has grown exponentially around the world in the past few years, mostly fueled by the rising interest rates meant to curb high inflation. Since the German legislators formulated and enacted clear crypto regulations, more asset managers have been allocating their portfolios to digital assets, with the trend expected to accelerate in the coming years. As for Deutsche Börse, it has been making notable moves to prepare for its ultimate launch of cryptocurrency trading.
For instance, the company acquired FundsDLT, a cross-boundary decentralized platform focused on investment fund distribution, to further enhance its digital financial services. Notably, Deutsche Börse has also invested in 360X Music AG, which is focused on tokenizing the music industry for mainstream investment.
The cryptocurrency market has grown to a $1.43 trillion industry and experts believe hundreds of trillions of dollars will enter the sector in the coming years fueled by institutional investors. Furthermore, the European Union has already enacted several crypto regulations through the Market in Crypto-Assets (MiCA) framework that will come into effect next year.
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