European Banks Jump Into Crypto

European banks like Spain’s BBVA and Germany’s Hauck & Aufhäuser both stated their readiness to launch crypto-related custodial and investment services at the beginning of 2021. 

Spain’s BBVA, for example, announced that it’s going to offer cryptocurrency trading and custody services. According to rumors, BBVA may launch its crypto custodial services around Christmas, but another more conservative option about January 2021 also exists.

Despite the rumors, the second-largest commercial bank in Spain, with $840 billion in assets, is ready to set out the base for its crypto-related services on Swiss ground. Switzerland became a preferred place for crypto-related businesses, as the country has clear digital currency regulations, watched closely by the Swiss Financial Market Supervisory Authority (FINMA).

The bank also signed a partnership with SILO for establishing the crypto custody platform, which, with the added regulatory approval by the FINMA, would allow BBVA to offer its crypto custody services across all of Europe.

Meanwhile, German banks have also set their eyes on the crypto space, as one of the oldest banks in Germany - Hauck & Aufhäuser, would launch a crypto investment fund in 2021. This move would allow institutional and semi-institutional investors to invest in a variety of cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), and Stellar Lumens (XLM).

The 224-year-old banking institution partnered with German fintech company Kapilendo in developing and launching the “HAIC Digital Asset Fund I.” Kapilendo would be used as a crypto asset depository, while Hauck & Aufhäuser would be responsible for the fund management. 

However, the bank set high entry requirements, as investors have to deposit at least €200,000 ($242,000), according to a report from Fundview. Also, the bank would charge a 2,05% fund management fee, calculated on the total fund volume. 

Hauck & Aufhäuser disclosed that the fund would offer coverage for 85% of the entire cryptocurrency asset market, while applying a passive investment strategy, which will allocate funds according to a number of factors, including market capitalization. 

Hauck & Aufhäuser board member Holger Sepp noted that “we are seeing that digital assets and cryptocurrencies are becoming increasingly attractive with institutional investors.”

“With the launch of our first crypto fund, together with Kapilendo, we have created an innovative investment vehicle that gives our customers inexpensive and secure access to the new crypto asset class while meeting the established quality standards and high demands of Hauck & Aufhäuser,” Sepp further noted.

Spain and Germany join other large banks both in Europe and worldwide. Back in October, Singapore’s largest bank, the DBS, demonstrated its crypto services for both retail and institutional investors. The services included both custody and trading, but the web page, where the services were showcased, was quickly taken down.

Many Eastern European banks, like those in Belarus, are also joining the crypto race, as Belarusbank started cryptocurrency trading services in October.