As part of its new technological modernization strategy, the German Federal Government is promoting a new bill that seeks to digitize securities through a blockchain.
In Europe, several countries have a long history of implementing and accelerating technological programs and projects that seek to massively promote technology. blockchain, and Germany is no exception. This country, considered one of the main drivers of economic development on the continent, is determined to become a global reference in crypto.
The new bill The initiative proposed by Germany focuses on digitizing and tokenizing securities within a blockchain, with the aim of bringing new digital assets closer to the financial tools of the traditional system. With this initiative, the nation recognizes the importance and need to modernize the financial sector and include new assets and securities represented in blockchain. This technology has massively burst into the lives of millions of people, and not only thanks to the use of blockchain. cryptocurrencies, that made it known, but also for its many implementations.
With this new law, Germany is also seeking to maintain and increase its financial attractiveness, becoming a much stronger and more technologically empowered nation that has gained several billion followers.
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Proactive approach to cryptocurrency development
“The draft law serves to modernize German securities law and the associated supervisory law.”
With this phrase begins the release issued by the German Ministry of Finance, which highlights the need to introduce a new electronic securities law to implement the Federal Government's blockchain strategy.
The Ministry of Finance points out that, according to current laws, financial securities must be titled in a document, which delays legal compliance and the marketability of securities in the eyes of potential buyers. Based on this situation, there is a need to create an efficient way of representing these securities, which is also safe and reliable, and which completely replaces the paper document. At this point, blockchain technology and its potential qualities have become the “suitable replacement” for the document.
The Ministry also notes that adapting the country's legal framework to new developing technologies, especially blockchain technology, will enable Germany to strengthen its position as a financial and commercial centre, while increasing market transparency and integrity and investor protection.
On the other hand, the bill also seeks to clarify the regulatory situation for digital assets in Germany. According to the Ministry, the Federal Financial Supervisory Authority (BaFin) will be responsible for monitoring the issuance and maintenance of decentralized records as new financial services, which will be based on the central regulation of securities deposit and others such as the eWpG and the German Banking Act KWG.
Blockchain technology implementations in Germany
For several years now, German technology companies have been experimenting with blockchain technology, and more recently, since last year, commercial banks in the country have also been implementing it.
In February last year, several major commercial banks conducted pilot tests with market securities transactions using blockchain. During these tests, a securities transaction worth 100 thousand euros was successfully carried out between the banks. Shelf y Commerzbank. The blockchain used during testing was based on Rope de R3, and according to report, the platform allowed the operation to be much more transparent, reliable and flexible.
Likewise, since December, German banks have been allowed to provide services with cryptocurrencies with the implementation of the Fourth EU Money Laundering Directive, so commercial banks can sell and hold Bitcoin and other crypto assets.
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