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ZA Bank, Hong Kong’s largest virtual sole lender, intends to expand into the region’s growing digital asset sector. The banking platform will offer crypto-to-fiat conversions and account services as the Chinese financial center seeks to embrace the industry.
Hong Kong’s first and largest virtual bank, co-founded by Chinese billionaire Ou Yaping, is looking to facilitate digital and fiat currency transfers for participants in the city’s burgeoning crypto sector, Bloomberg reported, citing the lender’s top executive.
According to CEO Ronald Iu, ZA Bank will offer crypto-to-fiat currency conversions through licensed exchanges, acting as a settlement bank for customers who deposit digital coins to the trading platforms and wish to withdraw Hong Kong and US dollars or Chinese yuan. Iu pointed out:
For the dozen or so interested companies, large and small, from abroad and locally, the most important thing for them is to have a way to make things work.
According to the report, ZA Bank is already working with the two currently authorized crypto exchanges in Hong Kong, Hashkey and OSL. It intends to offer the service to others as more platforms are licensed to operate in China’s special administrative region.
In a post-pandemic world, Hong Kong has opened up to the crypto space, despite its recent troubles. Aiming to become a crypto hub, the city is seeking to revive its status as a global financial center.
There have been signs that Hong Kong’s push into the crypto market has support from Beijing, despite the crackdown on mainland crypto activities. A report revealed in late March that state-owned Chinese banks are ready to serve crypto companies in the city. One of China’s largest insurance companies backed the launch of two crypto-focused funds in early April.
Hong Kong authorities are now working to revamp the legal framework for cryptocurrency exchanges to allow them to open to retail investors. The region’s financial regulators are also taking steps to improve access to banking services for crypto companies.
For now, ZA Bank only plans to engage with licensed digital asset exchanges. It conducts anti-money laundering (AML) controls in accordance with existing requirements and has not had any AML issues in recent months, according to its alternative managing director Devon Sin.
The virtual bank also opens online accounts for Web3 startups and other small and medium-sized businesses. Around 100 such companies have access to their services after a trial period in a regulatory sandbox, the report says.
Do you expect Hong Kong to continue to improve access to banking services for crypto companies? Tell us in the comments section below.
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