Capital markets News

DZ BANK, Germany’s 2nd largest, partners Metaco for digital asset custody

digital asset custody

Today Metaco announced that DZ BANK has selected its technology solution for digital asset custody. The bank has €297 billion ($315bn) in assets under custody and plans to use the solution for digital securities and digital currencies. Since the middle of last year, Metaco has landed Germany’s DekaBankBNP Paribas Securities Services, SocGen Forge and Citi as clients.

We reported on DZ’s digital asset custody plans back in October 2022. Holger Meffert, who heads the bank’s securities management division, told us a key driver was bank demand, particularly one of its biggest clients, Union Investment. 

While it may not be a household name, Union Investment has €427 billion ($452bn) in assets under management and is one of the most DLT-friendly asset managers in the world. For example, it has participated in the Euro-denominated EIB blockchain bond issuances on both public blockchain and private blockchain. Last week DZ BANK and Union Investment bought into the Siemens digital bond issued on a public blockchain. 

And in January, DZ BANK and Union Investment traded an over-the-counter derivatives contract as a smart contract. It follows similar experiments by DZ and Deutsche Börse a couple of years ago. 

“In terms of our security, scalability, and future requirements of our digital asset custody initiative for institutional clients, starting with crypto securities as per the German eWpG, Metaco Harmonize has proven to be a powerful solution that is fit for purpose and can support our intended operating model,” said Nils Christopeit, Lead Solution Design Digital Custody at DZ BANK.

German’s eWpG legislation allows digital securities registered in a central registry or “crypto securities” such as equities, bonds or other financial instruments issued on a public or private blockchain.

Meanwhile, apart from the four new clients mentioned, Metaco also provides its technology to DBS Bank and is backed by Standard Chartered.

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