Germany’s financial markets regulator BaFin has cautioned Coinbase about its German operations following an audit by Deloitte.
The regulator instructed the crypto exchange to put a “proper” business structure in place after the audit found deficiencies in Coinbase Germany GmbH’s organizational structure.
The nature of BaFin’s censure of Coinbase
The censure comes to bring Coinbase’s German operations in line with Section 25a Paragraph 2 Sentence 2 of the German Banking Act ( KWG ).
Section 25a of the Act primarily lays out rules for “appropriate and effective risk management” to ensure that a business is well-capitalized.
Furthermore, the Act outlines the need for internal rules on how an organization structures itself with employees of appropriate skill levels at each position. It also stipulates that a financial institution like a bank must have processes to identify, manage and report risks.
The…
