Key facts
- Germany leads Europe in crypto adoption, particularly among younger investors and through family offices, wealth managers, and advisors.
- The UK's digital asset market is considered nascent due to regulatory delays, according to CoinShares researcher Luke Nolan.
- Germany has 89 licensed crypto-asset service providers, accounting for 25.5% of companies in the ESMA's MiCA register.
- Deutsche Bank is awaiting regulatory approval for its crypto custody solutions for institutional clients, expected in October.
- The FCA will open licensing applications for crypto firms on September 30, with a deadline of February 28, 2027, for transitional arrangements.
Germany is demonstrating strong progress in cryptocurrency adoption, particularly among younger investors and through family offices and wealth managers, according to CoinShares crypto researcher Luke Nolan. In contrast, the UK is perceived to be falling behind due to regulatory hurdles.
Nolan told Cointelegraph that Germany's adoption is advancing well, with younger generations investing inherited wealth in digital assets. He described the UK's market as "nascent," largely because its Financial Conduct Authority (FCA) only recently lifted a ban on crypto exchange-traded products for retail participants, which had been in place since January 2021.
Germany's regulatory environment appears to be fostering growth, with 89 licensed crypto-asset service providers registered, making up 25.5% of companies in the European Securities and Markets Authority’s (ESMA) Markets in Crypto Assets (MiCA) register as of Wednesday. This follows Germany leading the EU bloc in authorized crypto companies in June with 57 firms.
Major German banks are actively engaging with the crypto space. Deutsche Bank announced on Wednesday that it is awaiting regulatory approval to offer crypto custody solutions to institutional clients in Europe, with a license anticipated in October. Additionally, Landesbank Baden-Württemberg, Germany's largest federal bank, partnered with Austria-based Bitpanda in April 2024 to provide crypto custody solutions for institutional clients.
Meanwhile, the UK's FCA has been finalizing its regulatory framework. On Wednesday, the regulator issued final guidance detailing when crypto activities will require authorization under the upcoming regime. Licensing applications will open on September 30, with firms having until February 28, 2027, to apply for transitional arrangements before the new regime takes effect on October 25, 2027. The FCA also announced on Thursday that it had sent cease-and-desist letters to three London locations suspected of facilitating illegal peer-to-peer crypto trading.