The German Federal Ministry of Finance has started a public consultation aimed at gathering feedback on the promotion of tokenized mutual fund shares.
In this context, feedback can be made until October 1, 2021.
The draft regulation allows mutual funds to issue specified units on the blockchain. A token represents a certain number of shares of a regulated fund. Tokenization offers many important benefits, such as lowering barriers to entry and reducing administrative costs.
The move to introduce tokenized mutual funds is one of the latest indications that blockchain and crypto assets are starting to become legitimate in the wealthiest EU countries.
According to a new German law that came into effect on August 2, institutional-focused funds are allowed to invest in crypto up to 20% of their total assets.
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