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More than 4,000 German institutional investment funds can invest in cryptocurrencies

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Bitcoin, BTC,
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The new law, which allows German dominant investment funds to invest up to 20% of its portfolio in cryptocurrencies, could boost investments in BTC by up to $ 415 billion. The German law, passed by parliament in April this year, entered into force on 1 July.

Up to 20 percent of funds can go to the purchase of cryptocurrencies

The new implementation means that huge amounts of new money could flow into BTC and other cryptocurrencies if each of Germany’s 4,000 dominant investment vehicles or institutions – known as Spezialfonds (similar to the Qualified Investors’ Fund) – decides to invest up to a fifth of the means to cryptocurrencies, as the new law now allows. These funds currently manage a total of EUR 1.87 trillion.

According to the previously valid wording of the law, these institutions could not allocate any of their funds to BTC and other cryptocurrencies as investments.

Are good times waiting for the cryptocurrency market?

Now, however, it is quite likely that many of these institutions will find BTC as a valuable asset in which to diversify their investments. And this scenario is also relatively realistic, as these are investment funds that want to have the most liquid assets in their portfolio.

However, according to Sven Hildebrandt, CEO of Distributed Ledger Consulting (DLC), who drafted the new law, it may take some time for the money to actually come to market.

“IT’S A FACT BIG THING It doesn’t happen overnight, but we’re talking about the biggest investment tool we have in Germany, it’s literally all the money.”

Conclusion

This is really big news, because we are talking about the implementation of the directive of countries that are among the most important countries of the European Union, and it can be expected that other organizations or funds across Europe can receive the same support.

In addition, with this legislation, Germany clearly shows that it is interested in being one of the most important players in the cryptocurrency market. It seems that interesting times await the cryptocurrency market. Sometimes waiting for the first player may take a while, but then it’s an avalanche, because no one wants to be the last.

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All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

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