A German Law Allowing $415B Crypto Investment Takes Effect

Today, a new law in Germany takes effect which can possibly bring $415 billion flow into crypto.

According to reports, this Fund Allocation Act in Germany permits Spezialfonds or special funds, to invest as much as 20% to crypto.

Furthermore, if every Spezialfond wants to allocate a full 20% from their portfolio, that will equate to $415 billion. The numbers are based on the total assets under the management of such funds in Germany. Sven Hildebrandt, CEO of Distributed Ledger Consulting (DLC), shared this data last April.

Of note, Spezialfonds are the German institutional investment vehicle of choice for most liquid asset classes.

In April, the Fund Allocation Act was introduced and approved by Germany’s parliament. Whereas, it takes effect today after it was approved before by the upper House, the Bundesrat.

Consequently, a significant allocation of this market toward crypto can bring profound implications across Europe. Especially, taking into consideration that Germany is the euro zone’s most powerful economy.

In the past few months, the country is showing such a good sign of accepting crypto. In fact, Deutsche Bank announced its intention to offer custody and brokerage services to its institutional clients this December.

Previously, Germany’s Financial Supervisory Authority (BaFin) granted Coinbase a new license. The license allows Coinbase exchange to continue operating in Germany as a crypto custodian.