As the world edges closer to a digital financial environment, institutions like KfW and Revolut are at the forefront. These European banks are deepening their forays into the crypto and blockchain arenas.
This move reflects their adaptation to technological advancements. It also highlights a strategic pivot in the traditional financial (TradFi) industry toward more innovative systems.
Digital Securities and Crypto Trading: KfW and Revolut’s New Frontier
The German bank – KfW is preparing to issue its first blockchain-based digital bond as crypto security, aligning with the German Electronic Securities Act (eWpG). KfW schedules this transaction for the summer of 2024.
Furthermore, KfW’s strategy also emphasizes robust investor engagement. A preparatory phase involving discussions with European institutional investors, including Union Investment as a significant investor, aims to familiarize them with the nuances of blockchain transactions.
Supporting this venture, a consortium of major banks, including Deutsche Bank, LBBW, and Bankhaus Metzler, will play pivotal roles. Additionally, DZ Bank will serve as the custodian for the bond.
Shifting focus to the UK, fintech giant Revolut has ‘Revolut X,’ a crypto trading platform that promises competitive fees and robust accessibility. Introduced on May 7, the platform caters specifically to retail customers.
Revolut X is designed to provide a more seamless experience, featuring fixed fees of 0% for makers and 0.09% for takers. This pricing structure might appeal to a wide range of traders and also directly challenge established crypto exchanges.
The platform will offer over 100 cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), and XRP, for the initial stage. However, the company plans to expand its selection in the near future.
Furthermore, the platform enables converting fiat currencies like the British pound to crypto and vice versa. This feature is expected to encourage wider adoption among UK residents.
These initiatives by KfW and Revolut highlight the growing interest of traditional banks in the crypto and blockchain sectors. Previously, Landesbank Baden-Wurttemberg (LBBW), Germany’s largest state bank, plans to offer cryptocurrency custody services in collaboration with Bitpanda exchange.
Likewise, HSBC, a leading bank in Hong Kong, plans to enhance its tokenization of real-world assets (RWA) and launched the HSBC Gold Token.
