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The cryptocurrency community over there in Germany is pretty much well-aware and elated about the recent news that their government recently made it into law implying that specialized investment funds can invest up to 20 percent of the US $2 trillion assets into crypto like Bitcoin (BTC).
Dubbed the Fund Location Act, the newly established law of the land could potentially bring over €350 billion ($415 billion) worth of crypto investments. In a report by Boersen-Zeitung back in April, the said figure was estimated by Distributed Ledger Consulting CEO Sven Hildebrandt.
It is said that there are around 4,000 of these special funds that just got covered by this new law in Germany that went into full swing on July 1 as it got cleared on April 22. BVI investments noted that by the end of December 2020, €1.88 trillion ($2.23 trillion) in these open special funds, though this does not include special real estate funds.
These special funds are deemed as controlled, open-ended investment funds that are limited to institutional investors (i.e., foundations, churches, insurance companies, corporations, financial institutions) Bitcoin.com writes. Further, these types of funds have been considered as massive investment movers in Germany. Think about it, a huge chunk of this market heading towards the realm of cryptocurrencies could likely create some extensive developments across Europe since the country has the biggest economy among the European nations.
Currently, the country has this cryptocurrency regulation that both residents and institutions in Germany are allowed to sell, purchase, and hold such digital assets. It can be recalled that in late June, the Federal Financial Supervisory Authority (BaFin) greenlit Coinbase to provide crypto custody services and proprietary trading.
Deutsche Bank adopting crypto assets
Also, it is worth noting that this year, Deutsche Bank decided to adopt cryptocurrency assets as economists in Germany made a forecast about the unfavorable effects of the U.S. dollar’s inflation. Further, the bank believes in the importance of Bitcoin and it’s too good to take no notice of. It was also learned that Deutsche Bank announced that they too will be offering brokerage and custody services to its institutional clients.
With that in mind, this huge step that Germany recently took could be seen by the cryptocurrency community as a breath of fresh air amidst China’s cryptocalypse.
Not sufficient
Albeit the fact that Germany is becoming one of the huge proponents of cryptocurrencies like Bitcoin, it may well seem that the country is still losing its grip against crypto crimes. This after a report from the anti-corruption collective Transparency International described the country’s political will in combating money laundering in the said country as “not even remotely sufficient.
The report comes after the collapse of the German fintech firm Wirecard which happened about a year ago. The country’s fraud investigators have been raising red flags on the rise of cryptocurrency scams, alongside tax evasion instances. This despite Germany having this reputation to be “squeaky clean,” Fortune noted.
The advocacy group also highlighted the huge gaps in Germany’s oversight of individuals and companies. The report’s author – Christoph Trautvetter stated that despite the country’s effort, it does not deserve to pass its Financial Action Task Force review. For the uninitiated, Germany will be subject to review by the said agency later in the year.
FATF was put up by the Group of Seven (G7) way back in 1989 as an intra-governmental watchdog. Currently, the organization has 37 member countries and a couple of regional bodies. As the threat of money laundering grows, it would be fitting that so does this organization.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
