Germany Legalizes Electronic Securities on the Blockchain

Angela Merkel's cabinet passed new legislation on Wednesday removing the requirement to have paper-based securities and allowing blockchain to be used instead.

AccessTimeIconDec 16, 2020 at 12:14 p.m. UTC
Updated Sep 14, 2021 at 10:43 a.m. UTC

The German government cabinet passed new legislation on Wednesday allowing all-electronic securities to be recorded using blockchain technology. 

  • The new law does away with the previous requirement for a paper-based certificate and comes as part of the nation's blockchain strategy blockchain, according to a Reuters report citing the German finance ministry.
  • Previously, issuers and securities holders had to document transactions with a paper certificate, which added administrative burdens and was seen as an obstacle for security holders, the report says.
  • “The paper certificate may be dear to some for nostalgic reasons, but the future belongs to its electronic version,” said German Finance Minister Olaf Scholz.
  • The ministry recommended last year that the country recognize and regulate blockchain-based securities as a legitimate form of financial instruments.

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