Germany crypto adoption advances as UK lags on regulation, CoinShares says

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Germany crypto adoption vs uk

Highlights

Germany leads EU crypto regulation with 89 licensed service providers, 25.5% of ESMA's MiCA register, and 57 firms authorized by June 2024.
Deutsche Bank expects regulatory approval for crypto custody solutions by October, while Landesbank Baden-Württemberg partnered with Bitpanda for custody services in April 2024.
UK digital asset market lags as FCA opens crypto licensing applications on Sept. 30, enforces cease-and-desist actions, and sets a full regime deadline for Oct. 25, 2027.

Adoption trends and institutional expansion

As reported by Cointelegraph, CoinShares researcher Luke Nolan says cryptocurrency adoption in Germany is making strong progress through family offices, wealth managers, individual advisers and younger generations seeking to invest inherited wealth in digital assets.

Nolan says the UK remains behind Germany because regulation has moved more slowly. He notes that the Financial Conduct Authority lifted its ban on crypto exchange-traded products less than a year ago, leaving the country’s digital asset market at an early stage after retail restrictions first took effect in January 2021.

Germany also holds a leading position in the European Union’s crypto licensing framework. The country has 89 licensed crypto-asset service providers, representing 25.5% of companies in the European Securities and Markets Authority’s Markets in Crypto Assets register updated on Wednesday, and it also leads the bloc by MiCA authorization in June with 57 authorized crypto companies.

Large German banks are also moving further into the sector. Deutsche Bank says it is awaiting regulatory approval to launch crypto custody solutions for institutional clients in Europe, with a license expected in October, while Landesbank Baden-Württemberg began offering crypto custody services in April 2024 through a partnership with Austria-based Bitpanda for its institutional custody platform.

UK regulatory rollout and market implications

The UK is still building out its formal crypto regime, with the FCA issuing final guidance on Wednesday on when crypto activities may require authorization under the incoming framework. The regulator is set to open licensing applications on Sept. 30, and firms seeking transitional arrangements face a Feb. 28, 2027 deadline before the new regime takes effect on Oct. 25, 2027.

Enforcement is also continuing alongside the rulemaking process. On Thursday, the FCA says it sent cease-and-desist letters to three London locations suspected of facilitating illegal peer-to-peer crypto trading.

The differing pace between Germany and the UK points to a wider competitive gap in Europe’s digital asset sector. Germany’s earlier licensing progress and growing bank participation are helping strengthen its position with institutional and private capital, while the UK remains in a transition phase as firms prepare for fuller authorization requirements.

Our earlier article on the House Ways and Means Committee’s digital-asset tax package explained how U.S. lawmakers are pushing to establish clearer federal tax treatment for digital assets as part of a broader legislative push. It also noted that the proposal ties tax-code updates to wider measures on tax administration, healthcare access, and supply-chain resilience, underscoring how policy design can influence the pace and structure of market adoption.

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