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AIBC

German law unlocks crypto investment funds

Posted:Jul 02, 2021 06:56 Category: Europe , Regulatory , Posted by
Stanley Yin

“Spezialfonds” will be allowed to direct 20% of their capital to investments in crypto

The Bundestag has passed a new law coming into effect on July 1, that allows domestic funds issued for institutional or peer use, so-called “Spezialfonds” (special funds), to utilize 20% of their capital for investment in crypto assets.

The monetary impact on the market is high, the potential sum to enter the market lies at €350 billion, or $415 billion across 4000 funds, with the market cap of Bitcoin standing at $768 billion. Additionally, the investment activities will require a more precise and developed regulatory framework. Experts believe that improved regulations in Germany will lead to higher security and institutional trust in DeFi.

“Spezialfonds” are the dominant institutional investment vehicle in Germany and creating this crypto-friendly environment in the largest economy in the Eurozone will largely impact the entire continent.

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