Bloomberg: Chinese banks eye servicing crypto firms based in Hong Kong

A number of large Chinese banks have opened accounts or sent requests offering cooperation to crypto firms based in Hong Kong. Citing informed sources, Bloomberg reports.

The agency noted local branches with state participation in the share capital of Shanghai Pudong Development Bank, Bank of Communications and Bank of China.

Co-founder and CEO of Odsy Network, Sean Lee, said that Hong Kong subsidiaries could benefit from the inflow of capital after turbulence in TradFi in the U.S..

“The jurisdiction will reap huge benefits. But questions remain as to whether the geopolitical climate will deter non-Asian projects from cooperating with Chinese banks,” — he said.

Lenders showed interest in the new niche ahead of the June 2023 launch of a licensing regime for crypto firms in the jurisdiction. In February, the Hong Kong Securities and Futures Commission (SFC)initiated public consultations on the new requirements for operators of digital asset trading platforms.

Major crypto companies such as Huobi, Gate.io, OKX and Bitget, as well as Singapore’s largest bank DBS Bank, have already announced their intent to obtain a license under the proposed rules.

In October 2022, media reported that the SFC to allow retail investors to directly invest in digital assets.

Subsequently, Hong Kong authorities adopted amendments to the anti-money laundering and counter-terrorist financing law, extending its scope to crypto service providers from 1 June 2023.

Earlier this year, the jurisdiction’s Financial Secretary Paul Chan said he was ready to welcome companies focused on digital assets from around the world.

As reported, the former BitMEX CEO Arthur Hayes suggested that China is trying to return to the crypto industry through Hong Kong.