Crypto Licensing in Germany: Rules, Requirements, and What You Need to Know

When it comes to crypto licensing in Germany, the legal framework that governs how businesses can offer crypto services like trading, custody, or staking under strict national and EU rules. Also known as Crypto Asset Service Provider (CASP) licensing, it’s no longer optional if you’re running a crypto business here—Germany enforces this like a traffic law. Unlike places where crypto operates in a gray zone, Germany treats digital assets as financial instruments, and if you’re touching them commercially, you need a license from BaFin, the Federal Financial Supervisory Authority.

This isn’t just paperwork. MiCA, the EU’s Markets in Crypto-Assets regulation that came fully into force in 2024. Also known as EU crypto regulation, it unified rules across all 27 member states, including Germany. That means a license granted in Germany now works across the EU—but only if you meet BaFin’s exact standards. You need proof of capital (at least €125,000 for basic services), a clear anti-money laundering plan, secure custody systems, and a management team with clean records. Banks won’t touch you without it. Even if you’re just offering crypto-to-fiat on-ramps, you’re in the same boat.

And it’s not just exchanges. Crypto custody, the secure storage of private keys on behalf of clients. Also known as crypto wallet services, it requires even higher capital and stricter audits. If you’re holding someone else’s Bitcoin or Ethereum, you’re essentially acting like a bank—and Germany treats you like one. Many startups try to skip this by calling themselves "tech platforms," but BaFin looks at what you do, not what you call it. If you’re moving crypto for others, you’re licensed or you’re breaking the law.

Germany doesn’t ban crypto. In fact, it’s one of the most active markets in Europe. But it demands transparency. You can’t just set up a website and start taking euros for Bitcoin. You need audited financial statements, documented KYC procedures, and a compliance officer who answers to BaFin. The process takes 6 to 12 months. Many applicants get rejected for minor gaps—like using a shared office space or having a director with a past financial violation. It’s strict, but it’s clear.

Below, you’ll find real-world breakdowns of what’s required, how companies are navigating the rules, and what happens when you try to cut corners. No fluff. Just what you need to know if you’re building, investing in, or using crypto services in Germany.