Hong Kong banks refused services to crypto companies, despite requests from the authorities
Date: 2023-07-20 Author: Karina Ziganova Categories: BUSINESS
Several major banks in Hong Kong have refused to provide any services related to cryptocurrencies, and some have banned customers of crypto exchanges from opening accounts with them. The Wall Street Journal writes about it
The publication notes that recently the situation with cryptocurrency exchanges is not the best way. And this is despite the fact that the Hong Kong authorities have taken a number of measures to develop the crypto industry. In particular, they lifted the long-term ban on trading digital assets for retail investors and introduced a new licensing regime for crypto exchanges.
However, financial institutions fear that cryptocurrencies can be used for money laundering, said one of the partners of the law firm Clifford Chance. At the same time, a source from the Hong Kong Monetary Authority explained that banks will not be able to refuse companies to open accounts just because of the direction of their activities. In his opinion, banks should try to meet the legitimate business needs of licensed crypto exchanges in the field of virtual assets.
Another source of the publication confirmed that one of the major international banks, whose name is not specified, changed its position and announced its readiness to open basic accounts for crypto exchanges with a local license. To prevent money laundering, they are going to apply the practice of the traditional financial sector.
Hong Kong authorities ask banks for loyalty
It is noteworthy that in April, local authorities began to urge banks to start providing services to cryptocurrency companies that have a local license. The Hong Kong Monetary Authority said that banks need to support crypto companies in their "legitimate need for bank accounts."
Moreover, even China's state-owned financial institutions turned out to be interested in working with crypto businesses in Hong Kong. Several subsidiaries of major Chinese banks have opened services for local cryptocurrency firms. We are talking about the local branches of the Bank of Communications, Bank of China and Shanghai Pudong Development Bank.
Local banks poach customers
In the wake of the U.S. banking crisis in the spring, banks in Hong Kong, including the local arm of a major Chinese state-owned lender, have accepted cryptocurrency companies as new customers.
Hong Kong-based crypto service provider HashKey Group said it plans to launch a new exchange called HashKey Pro. Hong Kong's virtual bank ZA Bank and Bank of Communications have promised to "facilitate the deposit and withdrawal of fiat currencies" for the platform.
