Deutsche Bank is exploring expanding it’s involvement in the digital asset sector, with a focus on stablecoins and tokenized deposits, according to a recent report.

The institution is considering launching its own stablecoin, participating in a collaborative industry project, and creating a proprietary tokenized deposit solution, Bloomberg reported. This initiative is spearheaded by Sabih Behzad, Deutsche Bank’s head of digital assets and currencies transformation.

“We can certainly see the momentum of stablecoins along with a regulatory supportive surroundings, especially in the U.S.,” Behzad stated.he added that banks have various options for engaging with stablecoins, including managing reserves or issuing their own, either independently or as part of a group.

Deutsche Bank has already invested in partior,a blockchain-based cross-border payments and settlement firm. It also participated in the Bank of International Settlements’ (BIS) Project AGRORA,which tested tokenization for wholesale cross-border payments. Furthermore, the bank has partnered with Taurus, a blockchain technology company, to offer digital asset custody services.

Stablecoins Gaining Traction

analysts at Deutsche Bank suggested in a May report that stablecoins are becoming increasingly mainstream.

“Banks have a wide variety of options available to engage in the stablecoin industry.” – Sabih Behzad, Deutsche Bank

The report highlighted the notable growth in the stablecoin market, from a $20 billion market cap in 2020 to $246 billion. The analysts emphasized that stablecoins are rapidly evolving into strategic assets, and regulatory clarity in the U.S. could further legitimize them in 2025.

Deutsche Bank’s partnership with Taurus, established in september 2023, aims to enhance the bank’s digital asset services by incorporating Taurus’ technology for custody and tokenization.

Paul Maley, global head of securities services at Deutsche Bank, noted the importance of custodians adapting to support clients in the digital asset space, which is projected to encompass trillions of dollars in assets.

In related news, Child Santander IN is also reportedly considering launching a stablecoin and providing its digital bank’s customers access to cryptocurrencies. Santander’s online banking unit, Open, has applied for licenses to offer these services under the European Union’s Markets in Crypto-Assets (MiCA) regulation.