105-year-old German bank DekaBank is planning to launch a blockchain-based tokenization platform in collaboration with the digital asset firm Metaco.
DekaBank targets the release of its blockchain platform sometime in 2024, while the infrastructure is expected to be ready in 2023, DekaBank’s digital asset custody executive Andreas Sack told Cointelegraph.
“The tokenization platform infrastructure will be ready in the foreseeable future, and that will launch the first minimum viable product in our crypto custody solution,” Sack stated. He added that the first test transactions of the tokenization platform are likely to take place this year.
DekaBank’s upcoming blockchain platform is developed in collaboration with the digital asset management system Metaco Harmonize. The bank officially announced a partnership with Metaco on Jan. 31, planning to deploy Harmonize as the core platform for an “institutional digital asset offering.”
According to Sack, the upcoming offering will involve tokenizing assets like bonds, stocks and funds in order to enable a new token economy. “Metaco is the key to this economy because it is our key management solution for tokenized assets on different blockchains,” he said.
The exec noted that plenty of blockchains are used for tokenization, including the Ethereum and Polygon networks. “It is not yet clear if there is one blockchain that will become the standard,” he added.
Related: HSBC needs someone to helm its tokenization efforts
Sack emphasized that DekaBank is not planning to offer trading of cryptocurrencies like Bitcoin (BTC) as part of its partnership with Metaco. That is because DekaBank is focused on regulated products, according to the German Electronic Securities Act, he said, adding:
“Cryptocurrencies are tradable around the world, more regulated in some parts of the world, and less to not regulated in other parts of the world. The implications that can arise due to these disparities are potentially very large and can carry very high risks.”
The new details about DekaBank’s upcoming digital asset platform come amid some major local banks moving into the cryptocurrency industry. DWS Group, the asset management arm of Deutsche Bank — one of the world’s leading financial service providers — is reportedly seeking to invest in two German crypto companies, including Deutsche Digital Assets and Tradias.
According to some rankings, Germany became the most favorable crypto economy in the world in 2022, based on factors like a favorable crypto outlook, clear crypto tax rules and transparent regulatory communications. German financial authority BaFin has issued multiple licenses to crypto exchanges, including firms like Coinbase and Bitpanda.