Topic: Germany's fourth largest bank "Commerzbank" Granted Bitcoin Custody Licence. (Read 235 times)

But isn't Bitcoin already legit in Germany and most other countries of the European Union, given that it can be traded, paid for and there is a clear regulation regarding taxes? It sounds a bit paradoxical that someone should think that Bitcoin is legal just because some central bank thinks so, especially if we know that they are only interested in how to make a profit, even if it meant that they would try to sell holy water to the devil himself.

Although from the point of view of an ordinary person, everything that is approved in some way by the authorities (banks) for the majority means that it is good and legal. Time will tell how positive (or negative) the banks will be for Bitcoin in the end, but I personally do not have a positive opinion that it is a winning combination in the long term.

One day soon, cryptocurrency, especially Bitcoin, will be the most popular investment around the world. I expect that everyone will begin to realize the importance of investing in Bitcoin.

But to me, the idea of banks accepting Bitcoin does not seem like a good idea because it will eliminate privacy. When you deal with a bank, you are forced to provide all documents and personal papers that contain information about you, and they will be linked to your Bitcoin address, and this will completely eliminate privacy.

I do not rule out that governments will encourage this step to obtain all the information they want.

Institutional investment or involvement in Bitcoin leads to centralization but it is also a tool of bitcoin awareness and adoption. Some uninformed people are comfortable keeping money with banks and other financial institutions. They prefer to keep funds with middlemen who will serve as custodians of the funds because they don't want to take the responsibility of keeping their keys. Bitcoin adoption will also lead to Bitcoin education, so with time people will begin to know that keeping funds in these centralised platforms is not safe. But I hope they won't learn these lessons the hard way such as the experience of FTX and others.   

It's not as if I don't welcome the adoption of bitcoin custody Licence in this German bank but isn't the motive of which bitcoin was created for gonna be altered like instead of being decentralized, by this adoption of the custody Licence  now the government will be the one to regulate the activities of bitcoin transactions thereby projecting it to still be centralized under their control,  banking involves a third party of which bitcoin is a decentralized medium of performing transaction directly with the person you want to transact with. So I wonder how this adoption of the custody licence by the bank will be helpful to bitcoiners.

By doing this the German central bank has essentially legitimised Bitcoin. It means
that those people who either have been oblivious or skeptical towards Bitcoin have been
convinced that actually Bitcoin is legit.

Like Poker Player said its people who dont know or have not got the knowledge to secure
their Bitcoin who will put their trust in the one place they shouldnt.

Like Spot ETF's its only a matter of time before all banks will follow this model *provided
they are allowed by their central banks 

Isn't it a worse solution than centralized exchanges? I see nothing better than centralized exchanges, but it will be more difficult for its users. People have already asked crypto users not to store their Bitcoin or cryptocurrency in centralized exchanges, and now there is an updated version of it: banks. Could you please point out one positive side that banks provide but centralized exchanges do not provide?

You pointed out the seed safety by giving your asset access to others. 
Isn't it like you gave your Bitcoin to someone else and will ask him to send it to you whenever you want? Also, you are giving him fees to hold your Bitcoin. The Bitcoin is yours, but you do not control them. Still, you call it safety. 

Another interesting piece of news, op, thanks! It's wonderful that some banks cease hostilities towards cryptocurrencies and see the opportunity of gaining more money by providing their customers with options that they might be interested in. Of course, most people here would say that people don't need and should not use banks to store their cryptos. That's true and reasonable, but some people like banks and trust banks, so it can be a way for them to invest in cryptos without thinking about the issues like keeping the seed safe.

I don't know much because I haven't used banks too much. I had a job and had to open a bank account to receive my salary. I resigned from my job a couple of years ago, and to be honest, I never kept any money in my account. I had to open another bank account because I wanted a dual currency credit or debit card to do international transactions when I visited outside of my country. I already experienced some bad things with my bank, but this topic is not about that. Insurance things never worked out in my country.

It's true that even though I don't want to use the bank, I now have no other choices. I cannot get crypto debit cards due to the government restrictions in my country. But I hope things will change in the future.

january 2023 EU bans banks from holding crypto custody..
why(rhetorical), well because it was not illegal before january..

so they ban it just so they can then impose rules to then permit/licence it.. and all done within a year

anything not illegal before.. gets banned, just so they can charge fees for licences later to allow it again (under condition)
they done it for drugs, they done it for alcohol... not a new story. its the game they play

I agree with you here, because most people who have heard about Bitcoin still think that there are some elements of ponzi schemes and internet fraud, and in the event that it appears as something that banks trust, they might change their opinion. So, on the one hand, people might start to look at BTC as something positive, but on the other hand, if we take into account the custody service and the risks of the same, and the fact that everyone who invests in BTC in that way actually supports it only as an investment, and not as currency.

When you mention hardware wallets, the recovery service that was designed by guys from France is based on the same idea, to help their mothers and grandmothers use cryptocurrencies more easily by sharing their seeds with everyone and everything because they will most likely lose them. In my opinion, all these ideas promoted by various "crypto geniuses" such as Ledger, CZ, or in the specific case banks, go in the direction of telling the average person that he is too stupid to be his own bank and that someone should still be trusted to keep confidential information for him.

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Banks have been building this trust for a very long time, so people trust them for that reason - but most people also simply do not see an alternative to banks and actually have no choice but to trust them, even if they have a bad opinion of them. Banks are, of course, much simpler and, from a security point of view, more favorable for the average person, and of course they have insurance even when someone robs them, or when someone steals your bank card and spends everything from your account.

Well said.
People get excited because they think it's positive news that banks are now engaging with cryptocurrency users. Usually, banks do not want to get involved with cryptocurrency users, and even they freeze crypto users' accounts in some countries. So, after hearing such news, people think yay, this is something good. The problem is, we don't know the main concept of Bitcoin and we are missing the system even after a decade. People still consider banks as their most trusted place to store their money.

I think this might be good for some. For example people who don’t want to use hardware walllets because they are too technical.

If you keep your Bitcoin yourself, there is always the risk of getting it stolen. If you hold it at the bank then most likely it’s insured and they will do a better job securing it than most individuals. Hence why this is a great option to have for many people using their bank to store crypto.

Well, actually, what this is going to facilitate is that my aunty, who used to buy only government bonds and some funds recommended by the bank, can end up buying Bitcoin and storing it there, because there is no way she is going to buy a HW, set up seeds and make transactions autonomously.

This is the catch-22 situation we have been in for years now. Everything that helps to popularize Bitcoin and mass adoption, moves it away from a P2P use outside of banks and states.

I second the opinion that my feeling for this is kinda mixed. I don't think this is a good way for Bitcoin to become mainstream, considering how any centralized party can basically control your coins in one way or the other. People who want to use crypto should also realize and learn how to be independent.

On the other hand, I guess it is inevitable that the majority of people will view Bitcoin or crypto as an asset and have no problem with third-party custody like what they've with stocks or shares. Fortunately, there is no law that forces people to use banks if they want to use Bitcoin. If that happens things will be so terrible for almost everyone.

"The first step by the Bank is to establish a secure and reliable platform with full regulatory compliance to support its institutional clients by providing custody for crypto assets based on blockchain technology."

This may appear as good news, as it kind of shows that the German government is looking into cryptocurrency but why would I trust the bank with the custody of my funds? What's the difference between the role of the bank here and an exchange? Self custody is the best way. Not your keys, not your coins.

Honestly, I feel like If you can't defeat your enemy then shake your hands, become close, and then stab in the back.
Obviously, Bitcoin is the enemy here for almost every financial institute that is run by the government or even some private sectors. All they are doing is showcasing that they are also part of the crypto community. Though this is happening slowly it is happening with clear thoughts and plans in their minds. Banks can't run without their users. The clients must deposit the money so that banks can use the same for their other products and services and charge heavy interest rates on the same. For example, loans, different kinds, and that too with the collateral from the same user who deposits or saves money in the same bank.

Now that crypto is out there peeps have a chance to escape that system. However, financial institutes are sensing that too. Now they will offer the same crypto ground with three control and thus users will start buying their crypto shit which is nothing but money but with a different face. Those institute wants nothing but their clients/users who will deposit money in their account no matter what is the format. Seems bigger games are coming.

This is indeed a good step toward crypto awareness and adoption because people tend to get involved in the sector when institutions like banks are involved. The involvement of these institutions helps build the confidence of people to buy cryptocurrencies.

But we shouldn't be thrilled by these moves by centralised platforms because they can also harm the market. Bitcoin was not created to be in the custody of any bank so his move is not a commendable one based on the goals of the coin which is to promote privacy and decentralization. I am also wondering if this crypto bank is secured by the Compensation Scheme of German Banks (EdB) in the case of bank failure. Will customer get back their deposited crypto assets if this bank collapse? If the answer is yes, then this service is better than exchanges that go down with customer's funds. But it is far better to keep your keys.

With the forums slogan of "Not your keys Not your coins" and the bank pretty much likely to be providing such a service that takes away the full control away from users, this will be received with mixed feelings as its likely to sit on users freedom...

Nevertheless, In the world of marketing they say any news is goods news and if the bank puts Bitcoin and crypto on the map then this should be considered as a win in whichever way we choose to see it, great news team Germany  

I will never hand over my keys to any bank, just as i would never store my BTC's in a centralized exchange. The idea behind BTC is to give you self custody of your coins and for you to spend it without anyone's permission, when you store your funds in a bank, they have custody of it and you need their permission to spend, that defeats some of the important purpose of BTC.

There are so many people who still store their coins in centralized exchanges because they think some of them are too big to fail, such people would not mind giving up custody of their coins to a bank, we must accept that there would be people who believe self custody is difficult and that their funds are safer when stored with a third party.

That's the kind of news we are expecting, Bitcoin adoption globally although this might be for a selfish reason but it's still a welcome development, for those who will be saving their crypto (Bitcoin and/or shitcoins, NFTs etc) assets in the banks hope they don't get mismanagement from this banks or fall victim of governmental central control.