Copy link
Increase text size
Decrease text size
Link copied

Germany’s new regulation targeting bitcoin exchanges and custodians may face these challenges

Image by Mark Pazolli from Flickr

Thu, 27 Feb 2020, 09:14 am UTC

Germany’s Financial Supervisory Authority (or BaFin) has released a new guideline urging bitcoin exchanges and custodians to get a license. Companies who will be addressing the German market no matter where they are based are required to get a license from the regulator.

Dr. Sven Hildebrandt, who advises semi-professional and professional financial institutions about blockchain technology, shared his opinion about the new regulation in an op-ed published on Bitcoin Magazine. According to him, there are still many open questions that need to be resolved and he found four concerns that could make the new regulation challenging.

First, it doesn’t define what “actively addressing” the German market means. It could mean anyone operating a designated German website or offering German marketing material or anyone with a growing number of German customers without “official” marketing.

Second, he felt that there was a lack of “passporting.” France is also sorting out its regulations and Hildebrandt felt that it’s best if the two countries would have agreed on passporting. This means that if one is already licensed in Germany, he can operate in France without applying for a new license. He is optimistic that this will happen, but he is convinced that it should be considered as early as now.

Third, the regulation is not clear. It stated that those who are interested should let the federal agency know of their intention to apply for a license before March 31, 2020, but the deadline of license application is before Nov. 30, 2020, which deemed the company illegal since Jan. 1, 2020, when the new regulation came into effect.

Fourth, Hildebrandt felt that there is a lack of communication regarding the international community given that it is an international topic.

“Up until now, I have seen neither a direct translation of the law nor any advice in English from the regulators. Although this is advantageous for those of us who work in consultancy and advise exchanges and custodians in exactly these matters, this lack of clear communication from regulators is problematic in general,” he wrote.

Hildebrandt concluded that the “new law makes operating digital assets business harder.” But he believes that eventually, it will bring a degree of clarity and security to the people in the digital asset space.

Meanwhile, crypto custodian BitGo has expanded its global footprint by launching new custodial entities in Switzerland and Germany.

TokenPost | [email protected]

<Copyright © TokenPost. All Rights Reserved. >

To leave a comment, please sign in.
More
  • Bitcoin (BTC) $6,455.24 (+1.64%)
  • Ethereum (ETH) $133.07 (+0.44%)
  • XRP (XRP) $0.224600 (+0.84%)
  • Bitcoin Cash (BCH) $220.84 (-0.11%)
  • Bitcoin SV (BSV) $166.51 (+1.53%)
  • Bitcoin (BTC) $6,455.24 (+1.64%)
Feb 21, 2020 (Friday)
12:01
Paxos launches blockchain-based securities settlement solution with Credit Suisse and Instinet
12:00
Brazil to launch new payment system in response to cryptocurrencies
11:59
Digital currency exchange Coinbase Pro lists Kyber Network token
11:57
Norwegian Air to soon start accepting crypto payments
10:21
Swedish central bank begins CBDC pilot with Accenture
09:51
Italian soccer team Juventus launches ethereum-based digital collectibles with Sorare
Feb 20, 2020 (Thursday)
14:16
Telecom companies complete cross-carrier mobile payments using blockchain
11:53
National Stock Exchange of Australia to develop DLT-based digital securities trading platform
11:00
South Korean ICO project discontinued, to return $7.5M to token holders
10:36
Samsung maintains crypto support in soon-to-launch Galaxy S20
09:41
BIS appoints Innovation Hub heads to lead Singapore and Switzerland
09:15
Coinbase becomes first crypto company to receive Visa principal membership
08:59
Dubai Economy and six banks launch KYC Blockchain Consortium
08:26
Crypto Technicals: ETH/USD under downside pressure after 'Bearish Engulfing' pattern
07:12
Tim Draper buys $1M worth of Aragon Tokens to create digital courts for DAOs
06:13
Renewable energy firm Acciona commits to take CBI’s blockchain-based carbon credits trading platform global
05:02
Crypto Technicals: BTC/USD trades below 21-EMA, break below 4H 200 MA (9386) to trigger further downside
04:56
Crypto exchange Coinfloor to launch a simplified bitcoin buying service
04:35
Indonesia’s customs department joins IBM- Maersk blockchain shipping platform “TradeLens”
Feb 19, 2020 (Wednesday)
12:46
Crypto custodian BitGo acquires digital securities startup Harbor
Subscribe to the TokenPost newsletter!
Don't show me this again today.
Back to top
Copyright ⓒ TokenPost. All Rights Reserved.
PUBLISHsoft