On the securities settlement side, the bank is eager to see the European Central Bank move forward with a wholesale central bank digital currency (CBDC) to facilitate the settlement of distributed ledger (DLT) transactions.
According to the reports, DZ Bank has chosen Metaco's Harmonize custody platform to provide digital currencies to its institutional clients. Metaco Harmonize is known for its global standards in security and scalability, making it a top choice for DZ’s needs.
The main reason behind this step is the demand from its leading client which includes Union Investment. The total asset under management for Union Investment with DZ is over $427 billion making it one of the biggest in the world. Union Investment is known for its actionable approach to technological innovation. Last year, Union Investment made a substantial investment in the European Investment Bank's (EIB) €100 million tokenized Ethereum bond issuance, with DZ Bank as a partner.
DZ Bank's foray into blockchain technology is far from its first. In 2019, the bank launched Finledger, a platform for promissory notes, in collaboration with DekaBank, Deutsche WertpapierService Bank, and Helaba.
This was no mere proof of concept; it was a fully operational system, albeit with only a few issuances per year. This was an important first step, and if it were launched today, it would likely garner more attention due to the increasing number of banks developing distributed ledger infrastructures.
This is a remarkable step in which banks are adjusting their operational models as per the market demands. A distributed ledger will encourage more banks to introduce blockchain technology to their platforms and move towards a decentralized economy.
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