Hong Kong crypto firms grab the attention of Chinese Banks
Despite the history of banning crypto, Hong Kong crypto firms grab the attention of Chinese Banks.
- Despite being against crypto the Govt of China is taking interest in Hong Kong’s new crypto licensing regime
- The Chinese banks have initiated providing banking services to Crypto firms in Hong Kong.
The Chinese government has previously been quite restrictive of cryptocurrency use in the state. They have even cracked down on mining and trading crypto in the country. However, it seems like the Chinese government might have started to grow a soft spot for crypto. As Chinese banks are looking to offer banking services to cryptocurrency firms in Hong Kong.
Recently Chinese government gave a slight nod to Hong Kong to initiate and create a favorable regulatory environment for cryptocurrencies. The new licensing framework for cryptocurrency exchanges is coming in June. This licensing framework will require the operating cryptocurrency exchanges to obtain a license from Hong Kong Security and Futures Commission (SFC). The purpose of this licensing regime is to help keep the authorities informed of any crypto activity taking place.
The new Crypto Licensing Framework in Hong Kong will be a step forward. Toward greater legitimacy for the crypto industry in Hong Kong. This may even be driving Chinese banks to establish relationships with crypto firms there to position themselves as key players in the industry,
According to a report by Bloomberg, Chinese banks have already initiated their services to crypto firms in Hong Kong. The Banks are various services including Shanghai Pudong Development Bank, the Bank of Communications Co., and Bank of China Ltd.
Hong Kong is the center of focus right now
Despite the ban on cryptocurrency in mainland China, Chinese Banks are reaching out to crypto firms in Hong Kong, recently. INdicating the Chinese support for Hong Kong’s efforts of regulating crypto. Also to establish itself as a major crypto center.
Julia Pang, head of banking relations at the OSL cryptocurrency trading platform, welcomed this interest from Chinese banks. Moreover, she sees it as a positive development for the regulated crypto industry.
She further added, that it is a demonstration of a growing understanding of the crypto sector through traditional financial issues. That Chinese banks are showing interest in engaging with the regulated crypto industry in Hong Kong. Additionally, this is a positive development for the industry as a whole and shows that the ecosystem is maturing.
The Hong Kong SFC proposed a new licensing regime for crypto exchange which is set to take effect in June 2023. Besides, these new licensing rules will allow retail investors to directly invest in digital assets. This is a departure from the SFC’s previous policy that limited crypto trading to professional investors only.
Thus far, Hong Kong has been successful in promoting the adoption of crypto for mass. Furthermore, representatives from the China Liaison Office have also been attending crypto events in Hong Kong.