German Institutional Funds Can Now Invest 20% of Portfolios in Crypto

German Institutional Funds Can Now Invest 20% of Portfolios in Crypto

by Virtuse Admin
9. August 2021
German Institutional Funds Can Now Invest 20% of Portfolios in Crypto

As per a Bloomberg report from July 30th, Spezialfonds – German investment funds with fixed rules – will be able to allocate as much as 20% of their holdings in digital assets. Those funds reportedly manage around 1.8 trillion euros or $2.1 trillion and can only be accessed by local institutional investors like insurers or pension firms.

Tim Kreutzmann – an expert on cryptocurrencies at BVI, Germany’s fund industry body – pointed out that the majority of the funds would most likely prefer to start small at first:

“Most funds will initially stay below the 20% mark. On the one hand, institutional investors such as insurers have strict regulatory requirements for their investment strategies. And on the other hand, they must also want to invest in crypto.”

Even though the initiative comes after increased demand from numerous German institutions towards cryptocurrency products, Kamil Kaczmarski – an executive at the management consultancy firm Oliver Wyman LLC – opined that many local investors are still skeptical, mainly because of the infamous volatility. He argued that this trend would remain for the next five years.

According to a spokesman, Deutsche Bank AG’s asset manager DWS Group and one of Germany’s leading financial institutions – DekaBank – have both showed interest in investing in cryptocurrencies but so far have not made any decisions.

As CryptoPotato reported in May, the German multinational financial institution – Deutsche Bank – demonstrated its support towards virtual currencies. Back then, its CIO – Christian Nolting – highlighted the growth of the asset class experienced in the past few years and especially following the COVID-19 pandemic. Moreover, he believes cryptocurrencies are here for the long haul:


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