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FameEX Hot Topics | State-Backed Banks in China Enlist Crypto Firms in Hong Kong

2023-04-18 11:20:45

Several Chinese state-owned banks have shown interest in partnering with crypto firms in Hong Kong, in response to the city’s push to become a crypto hub. Despite the ban on crypto activities in mainland China, the Hong Kong arm of the major state-owned Bank of Communications is reportedly in talks with several regulated crypto companies to open accounts. Another bank, ZA Bank, will act as the settlement bank for these crypto firms. These banks will facilitate the depositing and withdrawal of fiat currencies and enable token deposits at authorized exchanges to be withdrawn in Hong Kong dollars, Chinese yuan, and US dollars.

Hong Kong's government's crypto-friendly approach has attracted interest from nearly 80 cryptocurrency firms to open or expand their business in the city. Financial secretary Paul Chan clarified at the start of the year that the city is looking to collaborate with more crypto firms in 2023. Despite China's crackdowns on crypto activities in the country, Chinese banks and funds have formed partnerships with these crypto firms, highlighting China's growing interest in crypto via Hong Kong.

It is important to note that the partnership between the banks and crypto firms is limited to Hong Kong, and does not reflect a change in policy in mainland China. However, this move can be seen as a step towards the normalization of crypto activities in China, and potentially opening up the country's economy to the wider crypto industry. Hong Kong has long been seen as a gateway between mainland China and the rest of the world, and it appears that this role is extending to the crypto industry as well. As Hong Kong continues to embrace the crypto industry, it is possible that more Chinese state-owned banks and companies will follow suit, further expanding China's interest in the crypto space.

Disclaimer: The information provided in this section is for informational purposes only, doesn't represent any investment advice or FameEX's official view.

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