The Hong Kong authorities have reminded financial institutions that cryptocurrency firms are not banned from operating in the region. Consequently, the authorities are urging banks to provide services to these firms.
The de facto central bank of Hong Kong acknowledged complaints from digital virtual companies on Thursday about their challenges in obtaining banking services, such as opening bank accounts within the jurisdiction. Banking institutions have been reluctant to offer services to crypto companies, leading to their difficulties.
In a recent column published on the Hong Kong Monetary Authority’s (HKMA) website, the deputy chief executive, Arthur Yuen, clarified that entities dealing with virtual assets (VA) can now receive banking services from banks in Hong Kong. This is expected to help address crypto companies’ challenges in securing banking services.
Arthur Yuen underlined the absence of any legal or regulatory constraints that would hinder transactions related to VA services.
When conducting due diligence for VA entities, Arthur Yuen reminded banks to adopt a “risk-based approach.” Instead of employing a uniform approach to reject account opening applications, banks should exercise prudence by considering each VA entity’s traits and circumstances before deciding.
The Hong Kong Securities and Future Commission (SFC) announced yesterday that they would release comprehensive guidelines for regulating cryptocurrencies in May. The crypto community has been eagerly anticipating this report for months, and it is expected to shed light on the regulatory framework of digital assets in Hong Kong.
The SFC is poised to take the lead in regulating the emerging crypto industry, and the upcoming guidelines are hoped to bring legitimacy and stability to the field in the region. Many stakeholders anticipate this will mark a new cryptocurrency era in Hong Kong.