Crypto Firms in Hong Kong Get Boost as Regulators Host Meeting with Bankers
In an effort to facilitate financing for the industry as the city strives to become a global centre for cryptocurrency, Hong Kong officials intend to organise a conference between crypto businesses and bankers.
The gathering, which is set for April 28 at the Hong Kong Monetary Authority, is meant to “enable direct dialogue” between the parties and “exchange practical experiences and viewpoints in creating and managing bank accounts,” according to a Tuesday report from Bloomberg.
According to the report, the meeting will be co-hosted by the Securities and Futures Commission, another important regulator in charge of monitoring stablecoins and cryptocurrency exchanges, and the Hong Kong Monetary Authority, the city’s central banking organisation.
The move comes as tight know-your-customer (KYC) and anti-money laundering (AML) regulations are making it more challenging for crypto enterprises to open corporate bank accounts in the city, even for necessities like payroll accounts.
In the wake of the recent financial crisis in the US, which resulted in the closure of three major crypto-friendly banks, including Silicon Valley Bank, Silvergate Capital, and Signature Bank, many crypto enterprises are currently searching for new banking partners.
As previously reported, some Hong Kong-based Chinese state-owned banks, including Bank of Communications, Bank of China, and Shanghai Pudong Development Bank, have begun to provide banking services to regional cryptocurrency businesses or have expressed interest.
The development is viewed as proof that mainland China is supporting Hong Kong’s recent efforts to establish itself as a major hub for digital assets.
Crypto Firms Eye Presence in Hong Kong Amid Growing Regulatory Scrutiny in the US
Christian Hui, the Secretary for Financial Services and the Treasury in Hong Kong, reported last week that more than 80 businesses involved in the digital asset industry had expressed interest in setting up shop in the city since October 2022.
The increase coincides with the city’s recent shift towards being more pro-crypto in an effort to recover its status as a major global hub for the industry and draw in more crypto businesses, particularly those finding it challenging to operate from mainland China.
The Hong Kong Securities and Futures Commission (SFC) has published a consultation document on its proposed regulatory framework for crypto trading platforms, encouraging market participants to submit their views. This is one of the more positive developments.
The regulator added that provided protections including knowledge exams, risk profiles, and acceptable exposure limitations are in place, ordinary investors will be permitted to trade certain “large-cap tokens” on authorised exchanges.
In the meantime, the US Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC) have started a ruthless campaign against the cryptocurrency market.
The CFTC recently revealed that it is suing Binance and its founder Changpeng “CZ” Zhao on claims that the cryptocurrency exchange knowingly provided illegal crypto derivative products in the US.
Before this, the SEC had threatened legal action against Coinbase involving several of the digital assets featured on its platform, as well as its staking service Coinbase Earn, Coinbase Prime, and Coinbase Wallet.
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