Coinbase Becomes First Company To Secure Crypto Custody License In Germany
Germany's Federal Financial Supervisory Authority, also known as BaFin, has given crypto exchange Coinbase the license to run its crypto custody business in the country.
This makes Coinbase the first company authorized to provide crypto custody services in Germany according to the updated regulations.
Germany’s Licensing Rules For Crypto Custodians
Lawmakers had signed new rules at the end of 2019 stipulating that crypto custody firms wishing to operate in Germany should seek BaFin approval.
This law went into effect in January 2020 but provided a transition period for crypto companies that had already been operating in the country. The deadline for all companies to apply was slated for November 30, 2020.
According to the statement announcing Coinbase’s approval, BaFin said it had created an interdisciplinary, cross-divisional team that will oversee any issues related to the crypto custody business.
With this license, Coinbase Germany GmbH can conduct proprietary trading of crypto assets, BaFin said.
Speaking on this new feat, Marcus Hughes, Coinbase’s Managing Director for Europe, said in a blog post;
“Being awarded the license is the culmination of many months of hard work from the Coinbase team, in close collaboration with BaFin. We look forward to bringing a best-in-class crypto product offering coupled with a secure, localized experience to our German customers.”
Coinbase’s approval comes at a time when the company is trying to get all the regulatory backing it can as it expands operations.
The announcement also comes shortly after Japan's Financial Services Agency (FSA) granted Coinbase the permit to operate in Japan.
Founded in 2012, Coinbase is one of the most popular exchanges in the US. The exchange has been listing different assets on its professional trading platform, Coinbase Pro, recently.
Last month, Coinbase added a wide number of assets such as Cartesian (CTSI), iExec (RLC), Mirror Protocol (MIR), and Teller (TRB), Internet Computer (ICP), and Solana (SOL), among others.
Coinbase’s Rival Binance Struggles With Regulators
Coinbase has been thriving a lot this year. The Delaware-based firm has expanded quickly since its direct listing on Nasdaq and has shown commitment to working with national regulators.
However, the crypto exchange Binance has come under fire from regulators in different countries.
Binance has been warned by regulators in the UK and Japan to stop offering its derivative services. The Japanese Financial Services Agency issued a second warning to Binance a few days ago to stop operating without registering with the agency. The first warning was issued in March 2018.
In addition, Binance is no longer serving customers in Ontario, Canada, as it reportedly pulled out due to pressures from the Ontario Securities Commission (OSC).