Topic: 1.34 trillion asset manager Deutsche Bank to offer Bitcoin service (Read 282 times)

I'm pretty sure they have unique terms and agreements when it comes to services such as managing clients bitcoin, since we all know that crypto's prices are volatile, especially the bitcoin. They must have did it because of the less movement these days from the price of bitcoin, noticeably bitcoin is declaring its floor for the past years and that might be the very reason why this bank offered such services and they know that they are benefiting from it in the future. Also, they know how mind of millionaires are thinking when it comes to money making.

I wouldn't accept such offer if that's the case. BUT, I'll accept if there's a vesting period.

It doesn't make sense for them not to use a top notch tech company to build cold storage methods for them. They wants to make profits and attract more custormer to use their services and they know some customer would be skeptical of using this type of service from a bank.

Crypto is usually stored individually in a privet wallet so if they are using this kind of service through a company then they need to convince their customers that it will be better than self-custody.

For a company with 1.34 trillion dollars assets (and imagine their profits) that type of money would be "peanuts" (pun intended lol). I am sure that they will try to find the best cold storage method that they could before they do this and they will not have any trouble at all, I get that some people may think about it differently but I think it is going to be as good as it gets.

The best thing about this would be making sure that things are looking smooth, because if they can make it work for even just a while and people do not see any issues there at all, everyone will start to join even more. First order of business would be starting and having no issues for a very long time, rest will be a lot easier after that.

Your concerns regarding custody services that involve the use of Bitcoin or other crypto cryptocurrencies due to their nature of high level of volatility, are indeed valid. However, in order to mitigate this risk, banks may employ many strategies including lending Bitcoin on reasonable interest rates, as you mentioned in your post. However, introducing locking period when users can't access their funds, can be problematic, especially in case user requires immediate access for emergencies.

It is important to bear in mind that custody services primarily cater to large individual investors or entities who invest with long term perspective, often awaiting Bitcoin halving events when it traditionally delivers exceptional results.

Custody service with the use of the bitcoin is quite risky with their organization I guess we know how does the market is volatile or else they have another plan with the bitcoin they hold like for trades or lending so they can earn back all of those possible lose, and also if these services have a lock period sure they will offer something to the holders like having a reward, an increase of APY and etc. but as a user you will lock their funds with this service is not good I guess they don't have the full authority to their coin and possible market crash might lessen the value of their asset.

Indeed, involvement of the prominent financial institution like Deutsche bank is a very encouraging development and reflects the increasing demand of Bitcoin within European continent. This advancement can potentially pave the way for widespread acceptance of Bitcoin within Western countries where infrastructure is robust and know how about Bitcoin and its technology is more advance. However, the growing involvement of banks and issuance of Bitcoin ETFs may pose challenges to fundamental principle of decentralization.

When you say "we", then you are surely referring to an ordinary individual who can certainly choose the way in which he will buy cryptocurrency, while banks focus more on institutional players to whom they will primarily offer custodial services, not necessarily cryptocurrency trading.

It is logical that such investors will not use DEX because they still strive for transparency and seek liquidity and professional help with large investments, as is the case with Microstrategy and their business relationship with Coinbase.

This whole story with banks and cryptocurrencies in the EU is already several years old, but there is no great reason to be overly enthusiastic.

Banks have different types and tiers and a higher tier they are classified in, a bigger size their banks are, they will have to be regulated by more and stricter rules from central banks. It is to avoid bankruptcies from big banks that will trigger terrible domino-effects. Consequently, using services provided by those big banks will be more costly.

Why do we need those services from banks when we can buy bitcoin on non KYC exchanges, without support from banks.

https://kycnot.me/
Non-KYC exchange Encyclopedia

Bank lockers cost money too, sometimes a lot more than just a transaction fee, depending on the size and the popularity of the bank shop you are talking about, some bank stores are at popular places, like at the middle of the most crowded place, so they have larger safes and a lot more expensive, the further you go from civilization and you reach the same bank but a different store, you will get smaller and cheaper ones.

When we are talking about something online like this, you are talking about something that could be cheaper, not saying will be cheaper, but could be cheaper. Plus you do not have to actually go there after first time, which saves you a trip as well and could be done at your home via your mobile phone.

Most low-GDP countries, like Africa, want to use bitcoin to fight inflation. They don't have the infrastructure or capability to do nation-wide bitcoin adoption. Due to a lack of working law and enforcement agencies, people from these countries easily fall into fraudulent activity. We all want to spread bitcoin dominance, but with the proper infrastructure to develop a bitcoin-centric monetary system. Otherwise, people will develop a misunderstanding in their minds that bitcoin is full of scams.

The bank has taken a bold step in offering this service, especially considering the huge amount involved.
We hoping for some of this groundbreaking offers in Africa, so it help in spreading the Dominance of Bitcoin across-this side of the globe.
Where I can just walk into a bank and make a Bitcoin transaction.

Blackrock alone holds $10 trillion worth of assets, which is 10 times bigger than the total market capital of the crypto industry, and several of these companies have applied for ETFs. If one of their ETFs gets approve, others will as well. A small chunk of their assets in the bitcoin market can do wonders for bitcoin prices and its adoption. Users will join the masses through these companies.


People will use their service if they are offering interest over their holding.

Deutsche bank, like many in fairness, has been in it's fair share of scandals lately and will be on the hunt for new sources of income it thinks can be leveraged into a cost center. While it does give some legitimacy to Bitcoin in the short term, there is nothing to prevent them getting smacked down hard by either German regulators or those in places like America later on. It seems strange that more banks haven't started providing this service, but in reality they are the stalwarts who supposedly take great pride in heavily vetting their financial services and knowing who their customers are. Bitcoin can open them up to a bit of murky activity unless they take great care and they have been punished by huge fines for getting these things wrong in the past.

If that it is then this type of custody we were doing previous to this announcement like we can store our private key(written on paper or anything waterproof/heat proof) or hardware wallet in bank locker with other things like gold, cash, etc.
why going through this extra transaction fee of sending bitcoin to banks wallet address.

If you know German and are intelligent enough to find their site, maybe the answer you're looking for is there. If you want to save time, you should read what others have written on this topic, because if you had done that, you would surely have seen two links posted by other members.

---

A country where you pay 0% tax if you sell Bitcoin or another cryptocurrency for a year or more after purchase is not friendly enough? I don't know what is your version of a friendly country when it comes to Bitcoin?

Just a few years ago many banks, former economists and regulators argued that Bitcoin was illegal due to its lack of any centralized structure. We have seen that many large investment companies, banks and similar financial institutions have turned to Bitcoin in the last few months as its use by more and more individuals increases day by day. Although all the news is about attempts at this stage I think we will see many financial institutions offering these services in the near future.

I don't really want to express my negative thoughts but since Bitcoin is a volatile asset it may not attract much attention from financial institutions such as banks and customers at the first stage. The reason for this is that although blockchain technology has proven itself, the volatility that occurs due to the decentralized structure poses risks for both the intermediary institutions and the customers of these institutions. Of course, as I just mentioned, just a few years ago many financial institutions claimed that Bitcoin was unreliable but today it is possible to solve this problem or find a way as they continue to work to provide their customer portfolio with easy access to Bitcoin.

On the other hand, I hope that the Bitcoin price will not be taken under control by these institutions and large capital companies/investors and will not cause the vision of decentralization to be eliminated.

Finally, today's market conditions cause us not to see a serious price increase despite such good news coming one after the other. For this reason, we may see significant price increases in Bitcoin price after a possible economic recovery.

Providing these services is beneficial to the bank, as a group of investors want to try Bitcoin but do not want to be exposed to the private keys and bear responsibility. Such a group of investors may be looking for profits that these banks need. Also, stock and investment portfolio managers may recommend about 1% of the net assets in the bank. High-risk investments, and here Bitcoin is a suitable option for everyone.

I find this to be excellent news, and if companies and institutions continue to put 2% to 5% in Bitcoin, a lot will change quickly.

Is there an official announcement from Deutsche Bank about this news or do we have to trust some random Twitter account?
I have the feeling that this is fake news. Germany isn't the most Bitcoin/crypto friendly country in the world and Deutsche Bank is notorious for having problems with the regulators. Bitcoin is designed to be self-custodial. Leaving your BTC in a bank is a complete nonsense.
I think that the banks offering such crypto custody services think that most of the crypto enthusiasts are idiots.

I don't see anything positive in the fact that a bank that has been in big trouble for years will offer a service that, at least when it comes to Bitcoin, not only makes no sense, but is also potentially risky for anyone who uses such a service. Those who are not able to install a digital wallet or buy HW should not even engage in such investments - not to mention that storing Bitcoin in this way loses its true meaning.


Their assets under management are about 10 times smaller than BlackRock's, or 4-5 times smaller than Fidelity's - and besides, we are talking about the EU, where Bitcoin is nowhere near as popular as in the US. I do not believe that this will be the case even if a large bank offers this kind of service.

Besides, who in their right mind would allow their cryptocurrencies to be kept by a bank that constantly appears in the media in a negative context?

https://www.nytimes.com/2023/07/19/business/federal-reserve-deutsche-bank-fine.html
https://www.nestseekers.com/Guides/MarketReports/deutsche-bank-crisis-glance
https://www.usnews.com/news/economy/articles/2023-03-24/meltdown-in-deutsche-bank-shares-shows-banking-crisis-is-not-yet-over

It is far more riskier for them to let companies like Binance to takeover whole crypto business, it's far more riskier to weaken your influence on the the currency of the future. And Bitcoin Custody Service isn't really that risky for banks as you describe. Banks are long-term holders and long-term, bitcoin holders win. What matters for them is to increase number of coins, its everyday value is not that important.

It's not officially posted by DB but a lot of news websites post about that, for example, here is a Reuters article: https://www.reuters.com/business/finance/deutsche-bank-hold-crypto-institutional-clients-2023-09-14/

That's just the way it is. If someone like my aunt is going to end up buying Bitcoin at some point, she's going to do it through her bank and deposit it there, just like a lot of people on the street. Even billionaires who buy large amounts usually do it through centralized entities and deposit it there. Today I have seen the case of Mark Cuban, but Saylor at least initially said that he did it this way, but he did not shy away from the idea of self-custody in the future, which I do not know if he has already done, but in these cases I imagine that they want everything transparent as they are under scrutiny and also the possibility of suing a company if something happens with what they have there.

Another thing is that I personally plan to avoid banks like the plague for Bitcoin purchase and custody.

Oh okay, maybe I was lost in translation, but I don't think I can find a similar practice in my local bank, especially related to crypto asset. I really thought that 'Custodian Service' means that customer deposit their Bitcoin and they can't withdraw it for a certain period of time, and they will get some interest at the end of period. What is the benefit for the customer to use the custodian service instead of just using a cold wallet then? I mean would prefer just using a cold/hardware/offline wallet.

By mentioning their management size, we can imagine a clear picture of their experience and influence. If someone thinks that they are going to put all of their assets into bitcoin, they lack common sense. If these asset managers manage 1% of their total assets, that will be impactful as well. Just think how many asset managers applied for ETFs, and what if they all put 1% of their total assets toward buying bitcoin?

This type of title is to make it quite incredible but also a big lie at the same time. I mean they word it in a way that is "1.34 trillion asset manager" as in like if they are going to put all that money into bitcoin lol. We do not know if they are going to put in 50 million dollars or 5 billion, its a mystery to us, sure they are offering this service but its not know if they are going to end up with anything decent or not. We are going to end up with something that is a bit more done than that. This is why wording of this articles title is basically a way to manipulate you, like make it look like there will be ton of money going into bitcoin after this, when in reality we have absolutely no idea at all.

Institutional investing & custodianship will have a much bigger role to play in the next couple of years than in previous times. Bitcoin is in big demand & they all want their slice of the pie. Institutions were very wary & doubtful about the value of bitcoin until fairly recently. They are going to have to get involved soon though or miss out on a huge wave of adoption & the profits that come with that.

Custody service doesn't work that way! It's not a deposit where banks offers you an interest on it. Custody service literally means safeguarding an asset against a fee. So when you deposit bitcoin to the custodian, they will safeguard your bitcoins against a monthly or annual fees.

In case, some hacker hacks the bank's wallet and steal everything, your bitcoin will remain safe because it is the custodian's responsibility to return the bitcoins to you and the assets are always insured. There's no pending involved in custody.

This is good news for those who believe that they cannot handle or safely keep their investments. Other banks such as the French bank Societe Generale, Luxembourg branch of Standard Chartered and New York based Mellon Corp. are all registered cryptocurrency custodians. But I think they have limits to the amount of cryptocurrencies they can keep.


This kind of service will boost public confidence in Bitcoin because many people trust banks and believe in any service they provide. Another benefit of this service is that these customers' crypto deposits will be insured or protected by a deposit insurance company which means clients can get back their crypto deposits if Deutsche Bank goes through bankruptcy. But like you stated,  Bitcoin is designed to be in self-custody because not your keys, not your coins.

You are right, but you cannot change some people's minds. Some people are so stubborn that you cannot convince them against anything they think is right. Actually, the whole point is bringing more people onboard. Let people decide how they want to manage their funds, but at first let them use bitcoin. Some of them might move themselves towards self-custodial methods in the future.


Yeah, but you can't do anything about it except spread more awareness.

They will more easily lose their Bitcoin from keeping it on a third party custody service than from storing it themselves. The billions of dollars that has been lost to hacks or closures from custody service is very large compared to those who have lost their private keys or hardware wallets
When you consider that major hacks gets cover stories but users who are locked out of their wallets by the custody service are isolated cases and goes unreported the amount of lost or stolen bitcoins gets longer.

They are thinking very wrong.

I remember when Credit Suisse was shaking, the news and people's attention turns to Deutsche Bank as they think that it's the next one to face a collapse. I didn't followed what's next on it but it seems that those were just scary thoughts from everybody that has been invested a lot to Credit Suisse.

Yes, that's the actual use and service of theirs. Just like the typical investor that are not confident of their own skill but invests into asset management that has their own asset manager where they're responsible to keep their portfolios up and invests and spreads their clients money based on the decision of the manager. On the case of this custody service, even if we worry about those people that don't know much or don't like to setup their own wallets and bitcoin investments, that's their choice to choose services from banks like the Deustche Bank.

Here is the link: https://watcher.guru/news/deutsche-bank-to-offer-bitcoin-and-crypto-custody-services

Some people think that it is not secure to store their bitcoins by themselves, like some people think they cannot protect their gold, so they keep it in their bank lockers or with some custodians. They fear that they will lose their private key or hardware wallet, or they will die and their family won't get their bitcoin. People have different understandings of their surroundings, so those types of people who don't feel comfortable managing their own bitcoin wallet will use the services provided by the bank. Most of all, they will get a convenient environment to buy and sell their bitcoins.

I understand your concern about the potential risk associated with banks, but this can make some people's bitcoin lives easier. At least, this is what they think.

That's good news for the BTC and the whole crypto industry. No doubt, this does not directly put impact on the BTC's reputation but indirectly it does. Like, for the mass adoption of the BTC first digital currency must be accepted by the traditionally minded peoples. Who still sticks to traditional finance? Steps like these will promote the digital currency and people will get to know about them. Then trust will be built in their minds. And at last, they will get to know more about BTC.

And I hope once they know more about BTC they will definitely accept its decentralization factor and ignore the services being provided by the centralized authorities like these banks. Because there are basically 2 types of people. One who, doesn't want to use any centralized platform along with a decentralized one means they don't want to link their personal life with the crypto finance life. And then there are 2nd type of people who don't care about it. They openly used CEXs and DEXs and openly performed KYC and connected their personal life with the crypto sphere.

Besides all that, this news is still good news and it will definitely bring more audience and acceptance in BTC (digital currency) and it will ultimately increase its demand.

Is there a link to the source of this information other than the twitter link? Preferably, an official announcement about this from the Deutsche Bank.

A certain effect of popularizing bitcoin will occur if such a big bank as the Deutsche Bank offers storage services for bitcoin and crypto. But the problem is that banks want to make money by offering these services, and services that the bitcoin user can provide to himself. The user will give his btc to banks (loses control over his assets) and at the same time still pay (loses money) for an unnecessary service. What could be more stupid? The funny thing is that there will be plenty of people willing to take advantage of this stupidity.

Exactly! I can not blame my friend for not trusting bitcoin. It is my fault that I didn't try to spread awareness among my friends about Bitcoin or they fear to believe my word. But when they see that a large bank that they often use provides services for bitcoin they will trust it more than my word. A few of us don't trust the banking system and want to revolutionize the system, most of the people out there still have trust in banks. They will use it.

Are you sure about that? Drawing a parallel with stocks, there are custody services that cannot provide your shares and others that can. Obviously, the latter are cheaper in terms of fees than the former, but bank brokers or brokers linked to banks usually offer the former (simply custody, without being able to lend, and charging a fee).


Yes, not us on the forum, but many people who are now afraid of Bitcoin would buy it if they can do it through their bank and deposit it there. It is the recurring dilemma: it is not what Bitcoin was designed for, and in fact it goes against its philosophy, but it helps mass adoption and the rise in price.

That’s called as good face and bad face at the same time. We can’t rely on the banks for crypto services because we would end up sending our money in the centralised possession. Banks will earn the interest on that money they will also earn interest by giving away the loans at higher interest rates. They will definitely Back up the stability with fiat money itself. This is going to be encircling economy where no one but the banks will benefit a lot. I hope nobody use their services. Let us keep the money in bitcoin form preferably in our own custody. In the cold wallet or paper wallet. :-)
I am not sure what others to think about it but this is should be the way.

You are right. I am thinking about the publicity and users bitcoin will get from that bank. All of them won't use their custody service when they realize the risk associated with it. Many of them will turn their faces towards non-custodial wallets. More users means money inflow into the bitcoin market. This will increase the bitcoin market cap as well. These big institutions can provoke regulators for clearer regulation as well.

Not to be negative, but I think Custody Services by bank is too risky for both the Bank and the Customers because of Bitcoin volatility. As far as I know, when we hand over our assets to the bank for Custody service, those assets will be lended by the Bank to the other customers. If on the period of those lending, the Bitcoin price change either surge or drop significantly, it might be a disaster for the Bank and the customer.

When one of the world's largest banks offers such services, it gives more credibility to the industry and opens the door for wide adoption. This also shows the increase in consumer demand for digital assets like bitcoin. This will help the regulator provides clear rules and regulations to foster industry growth. Their move towards digital assets is a timely step when other top asset managers are applying for bitcoin ETFs. The demand for digital assets at the consumer end will force the regulator to come up with ideas to announce some clear regulation.




Source: https://twitter.com/WatcherGuru/status/1702325787049984186