Several Chinese state-owned banks have reportedly expressed interest in offering banking services to cryptocurrency firms operating in Hong Kong, despite the Chinese government’s ongoing ban on cryptocurrency. The news comes ahead of the implementation of a new licensing regime for cryptocurrency exchanges in Hong Kong, which is set to take effect in June.
According to a report from Bloomberg on March 27, several Chinese banks, including the Bank of Communications Co., Bank of China Ltd., and Shanghai Pudong Development Bank, have either begun to offer banking services to crypto firms in Hong Kong or made inquiries with them. The banks’ representatives are reportedly visiting the crypto firms’ main offices to pitch their services.
A spokesperson for Hong Kong-based crypto trading platform OSL said that the firm welcomed the growing interest from Chinese banks in engaging with the regulated crypto industry. The spokesperson also said that this development was encouraging for both the industry and the broader ecosystem, as it demonstrated a maturing understanding of the crypto sector by traditional financial institutions.
It is unclear at this time what specific services the Chinese banks are offering to crypto firms or what their motivations are for engaging with the industry despite the ban on cryptocurrency in China. Bloomberg’s sources spoke on the condition of anonymity.
Hong Kong’s Securities and Futures Commission (SFC) released a proposal for a licensing regime for cryptocurrency exchanges in February, which is set to take effect in June. In October of last year, the Hong Kong government floated the idea of introducing its own bill to regulate cryptocurrency.
Despite the regulatory uncertainty, Hong Kong continues to be a hub for the cryptocurrency industry. The region has seen growing interest from institutional investors in recent months, and representatives from the China Liaison Office have reportedly been attending cryptocurrency gatherings in Hong Kong.
