The account services for crypto firms come at a time when U.S.-based firms are struggling to find local banking partners and are frequently looking abroad.
ZA Bank, Hong Kong’s biggest virtual bank by assets is reportedly set to provide crypto account services and facilitate crypto-to-fiat exchanges.
According to an April 12 Bloomberg report, the bank will act as a settlement bank to allow token deposits at licensed exchanges to be withdrawn in Hong Kong dollars, Chinese yuan, and United States dollars and is also offering account services to crypto firms.
The accounts for local crypto firms follow a trial in a regulatory sandbox that saw approximately 100 firms participate, but ZA Bank’s CEO Ronald Iu noted that clients from mainland China would not be offered the service due to the country’s restrictions.
Goodbye Silvergate & Signature
Hello ZA Bank https://t.co/c6pmuycjev
— T ⛩ てぃ (@TeongH_SR) April 12, 2023
Iu added that currency conversions are currently being offered by the only two licensed crypto exchanges in Hong Kong, HashKey and OSL.
He said ZA Bank will provide the same service at other exchanges after they become licensed.
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As crypto firms in the U.S. struggle to find banking partners following the downfall of crypto-friendly banks Silicon Valley Bank, Silvergate Bank and Signature Bank, the Hong Kong-based ZA Bank appears to be offering the firms a potential solution, with Iu adding:
“For the dozens of interested firms, big or small, from abroad and local, top of their concern is to have a path to make things work.”
The announcement from ZA Bank follows a concerted effort by Hong Kong regulators to turn the region into a crypto hub, and many from the crypto community believe Hong Kong’s approach compared to hostility from U.S. regulators will help it succeed in its efforts.
Chinese state-owned banks have also reportedly seen an interest in the crypto firms moving to the city and are either offering banking services to crypto firms or making inquiries with them.
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