HK Regulators to Meet with Crypto Firms to Discuss Banking

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• Is Beijing Backing Hong Kong’s Crypto Aspirations?

As part of its goal of becoming a digital asset hub, Hong Kong is taking another step to ensure this is possible. Regulators of the special administrative region will soon host a meeting between digital asset firms and banks to discuss easing financing for the crypto sector.

Bloomberg reports that Hong Kong regulators will facilitate a “direct dialogue” on April 28 at the Hong Kong Monetary Authority (HKMA) to share “practical experiences and perspectives” for crypto firms as it relates to opening and maintaining bank accounts. The HKMA will hold the meeting in conjunction with the Securities and Futures Commission.

Hong Kong regulators are convening a meeting between crypto firms and bankers in a bid to ease financing for the sector https://t.co/eXZZ277mXr

— Bloomberg (@business) March 28, 2023

The city announced in October that it would position itself as a hub for digital asset and Web3 firms. Hong Kong has since been introducing regulations to attract firms to its shores and has proven successful in doing so, as over 80 foreign and Mainland China digital asset firms have expressed their interest in establishing roots in the city and obtaining operational licenses. The sector, however, faces significant challenges in securing banking services for basic needs such as payroll accounts due to traditional banks’ hesitancy and strict KYC and anti-money laundering requirements.

Is Beijing Backing Hong Kong’s Crypto Aspirations?

Crypto firms in Hong Kong recently received a glimmer of hope from a very unexpected source: Chinese state-owned banks. Previous reports indicate that several Chinese state-owned banks with branches in Hong Kong have turned crypto-friendly as they offer their services to local crypto companies. The Hong Kong branches of the Bank of Communications, Bank of China and Shanghai Pudong Development Bank have either begun offering banking services to local crypto firms or have made inquiries into doing so.

Despite crypto trading being banned in Mainland China since September 2021, rumour has it that banks from Mainland China have been reaching out to crypto-related firms suggesting that Hong Kong’s goal of becoming a global crypto hub may have Beijing’s support.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.