New Regulations on Crypto Funds in Germany

If you’re a cryptocurrency investor, you know that the industry has been facing challenges and most investor portfolios have seen better days. The crypto market has crashed and most are longing for a silver lining on these dark clouds. However, as authorities and industry players continue to take more lessons in crypto shifts, the tide might be turning.

For instance, in August 2021, Germany introduced a law that allowed fund managers to transact fund units electronically rather than physically. Furthermore, the regulations permitted crypto funds to register under a crypto securities register, reducing the cost of translation and time to market. And in essence, paved the way for the widespread acceptance of crypto as a genuine tender and an investment class asset in the country.

But if you still don’t understand what all this means, don’t worry. This piece will examine what the new German regulation on crypto might entail. So keep reading to learn more.

What Will be the Impact on Cryptocurrencies?

The first thing to note about the German crypto funds regulations is that they are a year old. And even though we cannot comment on the impact they’ve had on German investors and the crypto market so far. We can, however, comment on the state of the global crypto market.

As we all know, cryptocurrencies such as Bitcoin have lost over 60% of their value in the same period these regulations have been in effect. And yes, some might say that judging the new regulation’s impact might be unfair when the markets are this harsh. But, it goes without saying that the German crypto scene has not fared any better than the rest of the world.

However, this is not to say that they have not had any impact. Far from that. Institutional investors can now put up to 20% of their investments in crypto using specific domestic funds. Furthermore, German pension funds can now also invest in cryptocurrencies to the same tune as domestic funds.

In addition, the regulations don’t cover all known cryptocurrencies, but a handful of some like Bitcoin, Ether, and XRP. Also, part of the list is token-based bearers. What is key with buying into crypto funds in Germany is making sure they are regulated, and you can trust they are safe. A good way to do this is to use trusted Bitcoin information sites as they research these topics to make sure that investors are kept up to date.

How German Investors Will Adapt Their Internal Processes to This New Investment Opportunity?

Even though the market has not responded positively to these new changes in the German crypto regulations, we cannot understate the importance of this move. Cryptocurrencies have now received recognition from one of the leading global economies as legal tender and an investment class asset. Furthermore, they are now subject to regulations and oversight as any other currency or investment class asset.

And yes, some crypto purists will frown at this move and that the crypto market has not been doing too good. But once it recovers, the regulations will change everything for German investors. Below we’ll highlight some of the impacts we think the regulation will have on the crypto market in Germany.

1.   Increased Crypto Investments

Now that crypto investments are open to institutions such as certain domestic funds and pension funds. Investors whose arms were previously tied by the law or a lack thereof are now free to inject capital into the cryptocurrency market. Furthermore, they can invest up to 20% of their funds in crypto, an estimated £350 billion, with more investors expected to follow.  

2.   Digital Assets

Cryptocurrencies are now an accepted form of asset holding by the German authorities. This will increase investor confidence in the country and elevate digital assets to a more prominent role in the investor community. It will also open up a wider variety of investment opportunities from the traditional physical asset class.

3.   Wide Market Acceptance

Cryptocurrencies in Germany have also received a boost in the mass adoption cycle. Germans are more likely to accept crypto as a means of exchange now that the German authorities view it as so. Making it easier for crypto holders to access goods and services in the country.


Ever since Satoshi Nakamoto lit the fire on cryptocurrencies, the industry has gone through trials and tribulations as well as some good times. Currencies such as Bitcoin have hit record highs and lows and shown how crypto can be a good and bad investment. However, Rome was not built in a day, and there is no denying that there is a role for crypto in today’s world.

That’s why we commend the German government for taking such a bold stance on crypto and being the first nation to recognize it legally. We also hope other countries follow suit and bestow crypto its deserved economic status.

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