Danske Bank, the biggest bank in Denmark by market share, has changed its position on digital assets. After banning digital assets trading in 2018, the bank will now allow customers to invest in Bitcoin and Ethereum through exchange-traded products (ETPs).

This is a major shift for the bank. For years, Danske warned customers about the risks of bitcoin and did not allow trading on its platforms. Now, the bank says customer demand and clearer European regulations have led it to reconsider.

The new investment option is available through Danske eBanking and Danske Mobile Banking. However, it is only for self-directed investors. This means customers must make their own investment decisions without advice from the bank.

Importantly, Danske Bank says this move does not mean it supports digital assets as a long-term investment. This could mean the bank is still hesitant, but doesn’t want to miss market opportunities.

Kerstin Lysholm, Head of Investment Products & Offering at Danske Bank, said that offering access to certain digital asset ETPs on its platform does not mean the bank recommends the asset class.

The new products are ETPs that track the price of bitcoin and ethereum. Customers can invest in them without actually owning the digital coins.

This means investors do not need to open digital wallets or worry about storing digital assets themselves. In its statement, the bank said:

This helps the customers avoid the risks and technical challenges of holding bitcoin directly, but also means they have to trust 3rd party custodians.

At first, customers will have access to three “carefully selected” ETPs, two linked to bitcoin and one linked to ethereum. The products are offered by large asset managers BlackRock and WisdomTree. They follow EU financial rules under MiFID II, which are designed to protect investors and ensure transparency about costs.

Related: Bank of America Clears Advisers to Pitch Bitcoin ETFs to Clients

Lysholm said the bank believes ETPs are a safer and more practical way to invest in digital assets.

“For customers wanting to invest in cryptocurrencies, we regard ETPs as a suitable solution that offers clear advantages compared to direct investments in cryptocurrencies,” she said.
Danske Bank says it has seen growing interest in digital assets from customers in recent years.

“As cryptocurrencies have become a more common asset class, we are receiving an increasing number of enquiries from customers wanting the option of investing in cryptocurrencies as part of their investment portfolio,” Lysholm said.

Another key reason for the change is better regulation in Europe. The European Union recently introduced the Markets in Crypto-Assets (MiCA) regulation. This framework provides clearer rules for bitcoin companies and investors.

Before investing, customers must pass a suitability test. They need to answer questions that show they understand the risks involved.

The bank continues to describe digital assets as “very high risk.” It also calls them “opportunistic investments,” not part of a long-term investment strategy.