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eWpG: everything you need to know What is the eWpG?

The Electronic Securities Act (eWpG) is a German law that came into effect on June 2021, aiming to modernize the issuance and trading of securities by allowing the possibility to issue purely electronic securities without a physical certificate, and creating the so-called tokenized securities.

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eWpG lawbook

Why is it important?

By providing a legal framework from which companies can issue electronic securities using blockchain technology, it opens up a whole new world of investment opportunities for both issuers and investors, who can now issue and trade assets that were previously illiquid or inaccessible to certain investors.

Only the ability to now issue such assets as full-fledged securities really makes them liquid, as bona fide ownership and senior bonds become possible.

Issue electronic securities

Scope of application What is covered by the eWpG?

The eWpG recognizes electronic securities as legally protected rights that can be electronically represented and transferred. Under the eWpG, and the later introduced “Act on the Financing of future-proof Investments” (Zukunftsfinanzierungsgesetz), the securities that can be tokenized are:

  • Bearer bonds (tokenized claims)
  • Fund units
  • Shares

What are the characteristics of the eWpG?


It lays the foundation for the issuance of digital assets but is designed to be flexible enough to allow future additions and changes to be incorporated in a way that is in line with the interests of the market.


In contrast to the prior legal situation, it enables the issuance of digital securities without a physical certificate. This can be seen as progress in the digitalization and modernization of the German capital market.


The law in its current form is a sensible and, both innovative and bold basis for the issuance of electronic securities, which should be additionally refined with the insights gained from the further development of trading in tokenized securities.

What are the benefits of electronic securities under the eWpG?

New investment opportunities into previously hardly investable assets.

Increased value proposition with additional functions such as lending, voting and collateral.

24/7 trading basis that provide greater flexibility in managing investments.

Peer-to-peer marketplaces & simplified price discovery for illiquid assets.

Trade is executed by Smart Contracts and all transactions are auditable on-chain.

Trading and settlement occur simultaneously, without any intermediary agents or arbitrary delays.

Tokens can be transferred immediately after order matching, thereby reducing counterparty risk.

Low transaction on-chain costs for trading and settlement via the trading platform.

Which role does the register play?

The central element of electronic securities is their entry into a register, which can only be operated by a BaFin-licensed financial institute, like NYALA’s Smart Registry. The eWpG allows registration in both centralized and decentralized registers (so-called crypto securities registers).

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Crypto securities register

Under the eWpG, electronic securities can be registered in a crypto securities register, operated on the basis of Distributed Ledger Technology (DLT).
Electronic securities that are issued through entry in a crypto securities register are referred to as crypto securities and need to be mantained on a tamper-proof system of record and protected against unauthorised deletion and modification.

Crypto securities registration is a financial service supervised by BaFin (Federal Financial Supervisory Authority), and it is subject to requirements regarding business organisation and conduct.

Our Crypto Securities Register

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Central securities register

Alternatively, securities can be entered in a central securities register. The physical global note used in the past is now being replaced by the entry of the issue in a database. Transactions are shown in electronic book entries to securities accounts.

Central registers may be kept by a central depository for securities (Wertpapiersammelbank), also referred to as a central securities depository – Zentralverwahrer, or, if expressly authorised by the issuer, by a custodian (Verwahrer), also called a custodian bank – Depotbank.

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Contact Everything you need to know about the eWpG

Do you want to know more?

Contact us for a consultation with our expert:


Celina Homps
Business Development Manager

Let’s shape the future of the financial industry together:

Nyala Digital Asset AG
Uhlandstraße 32
10719 Berlin

E-Mail info{at}
LinkedIn @nyala_de

NYALA Digital Asset AG

Uhlandstraße 32

10719 Berlin