BaFin: Blockchain Could Lead to 'New Standard' in Financial Markets

Germany’s top securities regulator has published a report that explores blockchain tech, offering early hints at how it views the technology.

AccessTimeIconMar 3, 2016 at 3:10 p.m. UTC
Updated Sep 11, 2021 at 12:09 p.m. UTC

Germany's top securities regulator published an internal journal last month with a cover story on the topic of blockchain tech, exploring its inner workings and offering early hints at how it views the emerging technology.

In a newly published English translation, the agency, known as the Bundesanstalt für Finanzdienstleistungsaufsicht, or BaFin, explored potential applications of distributed ledgers, including its use in cross-border payments, interbank transfers and the storage of trading data.

Though light on regulatory details, the publication suggests that BaFin sees a possible future in which the technology reshapes how some elements of the financial system function, though it posits that this outcome is far from certain.

The agency states:

"The impact on the financial industry of increased or even full-scale deployment of DLT cannot be foreseen as of yet. However, it seems that it has the potential to establish a new standard in the financial market."

BaFin argues that acknowledgement of the possible risks of applying the technology "is more important than ever", going on to echo other regulatory bodies worldwide by calling for greater oversight.

"Adherence to regulations on anti-money laundering, governance and compliance as well as for clearing and settlement must also be ensured," the agency notes. "The lack of a central authority on conduct and regulations could pose problems here in particular."

The agency previously released guidance on bitcoin and digital currencies, referring to them as "financial instruments in the form of units of account" that do not have legal tender status.

Brandenburg image via Shutterstock


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to to register and buy your pass now.