Cryptocurrencies are gaining popularity among institutional investors as well as individual investors.
In this context, banks have invested in crypto while providing crypto custody services for their customers.
However, some countries also keep investors under pressure as they adopt a negative approach to cryptocurrencies.
The Danish financial watchdog “The Danish Financial Supervisory Authority (FSA)” said in a statement today that it is illegal for banks to run cryptocurrency as a side business under current regulations.
In this announcement, the FSA received an order from Danish bank Saxo Bank to divest its holdings of crypto assets.
“Saxo Bank offers its customers the opportunity to transact with a range of crypto-asset products through the bank's platform.
Saxo Bank also engaged in own account trading of crypto assets to cover risks associated with the supply of other financial products.
However, this does not change the fact that it is not allowed by Danish financial institutions.
In this context, it has been determined that Saxo Bank's trading of crypto assets on its own account is outside the legal business area of financial institutions, including Article 24 of the Financial Trading Law.
For this reason, Saxo Bank has been ordered to divest its crypto assets.”
The FSA recently said that crypto activities are currently not regulated in the country, as the European Union's crypto regulation, known as MICA, comes into effect from December 30, 2024.