Dr. Ulli Spankowski, Boerse Stuttgart's chief digital officer, has revealed the fifth anti-money laundering directive (AMLD5) unexpectedly increased institutional interest in cryptocurrencies.
While speaking on a panel at the CryptoCompare Digital Asset Summit in London, Spankowski said he was “surprised” by the positive effect AMLD5 had on institutional interest in the cryptocurrency space. He said:
I actually didn't think anything would happen because banks and other financial institutions could already do crypto custody [and] could do crypto trading.
Spankowski added, however, that since the law came into effect Boerse Stuttgart saw “a lot of interest from the traditional players as well” on the cryptocurrency space. The trading platform has listed several crypto products, but in September 2019 fully entered the cryptocurrency space by launching a bitcoin-euro spot pair on its subsidiary, the Boerse Stuttgart Digital Exchange (BSDEX).
The executive added that as there’s a license for trading platform to list cryptocurrencies, institutional investors must be thinking it “must be legit.” He added BSDEX has over 120 institutional clients and an “open relationship” with Germany’s financial regulators, and as such can act as a trusted “gateway” for crypto. He added:
We could be the gate opener [for crypto] ... because the traditional financial industry is already connected to us on a European scale
It’s worth noting AMLD5 - which requires companies based in European Union members to register with local regulators, introduce KYC checks, and hold information on clients’ source of funds – saw various cryptocurrency firms leave the region. These include KyberSwap and Deribit.
As CryptoGlobe reported, at least three cryptocurrency firms announced they were shutting down because of the regulations. These included Bottle Ply, which provided users with a service to send crypto via social media, mining pool Simplecoin, and gaming platform Chopcoin.
Featured image from the CryptoCompare Digital Asset Summit.