Bitpanda Gets Licensed in Germany

Bitpanda has received a license to provide cryptocurrency services from the German financial markets regulator BaFin. This regulatory approval comes amid growing scrutiny over crypto firms following the collapse of FTX, which was once one of the largest cryptocurrency exchanges by trading volumes.

Bitpanda gets approval from BaFin

The German subsidiary of Bitpanda has received the regulatory green light to process crypto transactions for customers based in Germany under the Custody and Proprietary Trading license. The company will not be subject to any passporting rules.

While Europe has been operating under a variety of licenses, the license that BaFin has given is quite unique. This license has only been granted to four companies BaFin approves to provide cryptocurrency custody services.

The other company with a similar license is Coinbase, a publicly listed exchange in the United States. According to BitPanda, it was the first retail trading platform within Europe to obtain the license after meeting the requirements.

Besides the recently obtained license in Germany, Bitpanda also holds a license with regulators in Austria and France. Bitpanda is planning to expand its white-labeling business. These licenses will allow Bitpanda to expand its operations in Europe and help it secure partnership deals with fintech companies in Europe.

The co-founder and CEO of Bitpanda, Eric Demuth, commented on the recently secured license saying that Bitpanda has set high standards and was committed to doing things the right way.

Demuth said,

This principle is firmly embedded in our DNA as a fully regulated investment platform and, in my opinion, critical to the long-term success of our industry. The security of our customers’ digital assets, as well as those of our White Label partners, is our top priority.

Besides operating in Austria, France, and Germany, Bitpanda will also receive regulatory approval in the Czech Republic, Italy, Spain, Sweden, and the United Kingdom. The EU is set to become a regulated crypto hub under the Markets in Crypto Assets (MiCA) regulations. These regulations will help protect European customers investing in crypto assets.

FTX collapse has dampened trust in crypto platforms

Despite Bitpanda receiving this approval, there has been scrutiny over how crypto firms operate following the bankruptcy filing of the FTX exchange. This year, several crypto firms have collapsed amid the bear market, which has left customers counting losses as they cannot take out their funds from the platforms.

FTX was one of the firms that had a significant presence in Europe. The exchange offered services to EU countries using K-DNA Financial Services Ltd. The latter is an investment company that the Cyprus Securities and Exchange Commission regulates. The license allowed the exchange to provide services in the wider European Economic Area.

The bankruptcy case for FTX has already commenced, and it will help determine whether the exchange has funds that can be used to reimburse users. The exchange has more than one million creditors.

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