Germany has passed a new bill that would introduce all-electronic securities as part of its blockchain strategy. This information was released by the finance ministry and is part of the European nation’s plans to integrate a robust blockchain framework.
A Shift from Paper Certification
The new regulation eases the existing rules that mandated issuers and holders of securities to record transactions with a paper certificate. Financial firms can now record transactions with an entry in a central securities depository or via a register kept by the private sector banks.
There are also provisions for an entry into crypto securities that is built on blockchain technology. Speaking on the development, the German Finance Minister Olaf Scholz believes that electronic securities are the future. “The paper certificate may be dear to some for nostalgic reasons, but the future belongs to its electronic version,” he further added that electronic securities reduce costs and administrative bureaucracy.
This sentiment was further echoed by German Justice Minister Christine Lambrecht who said that the law provides legal clarity and enhances the adoption of new technologies.
Germany finance ministry has been opened to blockchain technology and recommended last year that the country recognizes crypto-based securities as a form of financial instruments.
Germany and Blockchain technology
Germany is one of the countries in the world that has extensive laws guiding blockchain technology. This has made it one of the regions with a high rate of crypto adoption and several traditional financial powerhouses have begun to develop products based on blockchain technology.
Recently Bankhaus von der Heydt, one of the oldest banks in Germany issued the first of a kind Euro stablecoin on the stellar blockchain. The stablecoin was developed in conjunction with crypto exchange Bitbond. Bitbond will handle the tokenization and custody part as they are expert providers on that end. In their collaboration, the bank will now directly issue the Euro stablecoin on the scalable, finance-focused the Stellar blockchain.
There have also been other major developments in the country that has fostered the growth of blockchain technology. It is expected that the blockchain industry will continue to grow in the coming months as more laws have been proposed to increase the blockchain framework.