Deutsche Bank to Enter Crypto Custody Market by 2026

The crypto custody service will initially support major digital assets like Bitcoin and Ethereum, according to a Bloomberg report The offering will also include services for tokenized securities and other digital financial instruments. Deutsche Bank is working with two key partners on the initiative: Bitpanda, a Vienna-based crypto platform, and Taurus, a Swiss digital asset infrastructure provider.

The decision to enter the custody space comes amid a global wave of institutional interest in digital assets, as well as increasing pressure on banks to offer secure solutions compliant with national and European Union regulations.

Bitpanda, which received a license as a crypto custodian and investment firm from Germany’s financial regulator BaFin, will provide the technological foundation for retail and institutional integration. Taurus, on the other hand, specializes in enterprise-grade blockchain infrastructure, including custody and tokenization of both crypto and traditional financial assets. Taurus’s platform is already used by several global financial institutions.

The partnership allows Deutsche Bank to rely on existing, battle-tested digital infrastructure while maintaining regulatory compliance under Germany’s crypto asset laws and the European Union’s Markets in Crypto-Assets Regulation (MiCA), which begins enforcement in late 2024.

Initially, the custody platform will focus on institutional clients, such as asset managers, hedge funds, and pension funds, who require secure, bank-grade solutions for managing digital assets. It’s unclear whether Deutsche Bank plans to eventually expand the service to retail customers, but its collaboration with Bitpanda may lay the groundwork for broader access in the future.

Deutsche Bank first disclosed in June 2023 that it had applied for a digital asset custody license from BaFin. The license is a requirement for any entity offering crypto custody services in Germany under the 2020 implementation of the country's digital asset framework. The regulatory green light is expected sometime in 2025, paving the way for a commercial launch the following year.

The licensing process comes at a time when BaFin is tightening oversight of digital assets, particularly in anticipation of the EU’s MiCA rules. Deutsche Bank’s early engagement with regulators positions it favorably compared to other banks that are only now entering the crypto arena.

Deutsche Bank’s move is not isolated. The firm’s asset management arm, DWS Group, has explored investments in crypto-related companies including Tradias and Deutsche Digital Assets. In Asia, the bank has participated in Project DAMA (Digital Assets Management Access), a proof-of-concept trial with Singapore’s Memento Blockchain to explore tokenized fund management.

Other major German banks are pursuing similar paths. DZ Bank, the country’s third-largest lender, launched its own digital asset custody platform in November 2023. Landesbank Baden-Württemberg (LBBW) has also partnered with Bitpanda to offer crypto services to its clients. These moves suggest that Germany is quickly becoming one of the most active European markets for institutional crypto finance.

While crypto custody may seem like a technical back-end service, it plays a critical role in the future of finance. Tokenized real-world assets (RWAs), including stocks, bonds, real estate, and art, are expected to become a multi-trillion-dollar market by the end of the decade. By offering a regulated environment for storing and transferring these digital assets, Deutsche Bank is aiming to position itself at the center of this transition.

Deutsche Bank’s announcement marks another milestone in the convergence between traditional financial institutions and the emerging world of crypto. As regulatory frameworks like MiCA gain traction, and as more institutional capital flows into digital markets, established banks are increasingly stepping up to offer compliant and secure services.