The Danish Financial Supervisory Authority (DFSA) has issued an order to Saxo Bank, a local investment bank, to sell off its cryptocurrency holdings. This order comes since the activities related to crypto-assets are not covered by the Danish Financial Business Act, under Section 24.
Cryptocurrency service providers in Denmark are also being targeted, as local banks are not allowed to hold digital currencies to hedge trading risks. In the case of Saxo Bank, the DFSA points out that customers can trade different cryptocurrencies through the platform, and the bank also has its own portfolio of Bitcoin assets.
The DFSA said: “Saxo Bank’s trading in crypto assets for its own account is found to be outside the legal business area of financial institutions. On this basis, Saxo Bank is ordered to dispose of its own holdings of crypto assets.”
Despite the order, it will be interesting to see how Saxo Bank will continue to provide its crypto products, as customers don’t buy cryptocurrency directly, but rather financial products that track the price of digital assets.
