Hong Kong Struggles To Draw In Major Banks to Cryptocurrency Industry

Hong Kong
  • Hong Kong’s banking regulator continues to be putting pressure on major banks.
  • Major banking institutions are cautious about dealing with the cryptocurrency industry.

Regardless of Hong Kong’s efforts to get Asia’s cryptocurrency capital, major banking institutions remain reluctant to participate the popularity. Based on the newest Foot article, Hong Kong’s banking regulator continues to be putting pressure on major banks. Included in this are Standard Chartered and HSBC for dealing with cryptocurrency exchanges.

The Hong Kong Financial Authority (HKMA) apparently lately asked the 2 United kingdom-based lenders and also the Bank of China. On why they aren’t ready to handle crypto customers, based on sources acquainted with the topic.

Cautious about U.S Like Situation

The Financial Occasions has acquired instructions in the HKMA dated April 27 where the regulator advises banks to not “create undue burden” while doing research on cryptocurrency companies, especially “for individuals establishing a workplace in Hong Kong to discover the possibilities here.”

Whilst no country has outright banned cryptocurrencies, major banking institutions are nevertheless cautious about dealing with the cryptocurrency niche for anxiety about legal repercussions if customers use cryptocurrency exchanges for criminal purposes like money washing. However, this is usually a setback for Hong Kong’s efforts to become cryptocurrency hub for that world.

The United States Registration (SEC) sued cryptocurrency exchange Coinbase a week ago for allegedly breaking federal securities laws and regulations. It was not lengthy prior to the Hong Kong lawmaker extended an invite to Coinbase to spread out a workplace within the territory.

Recent occasions, however, have placed banking institutions inside a precarious situation. There’s more pressure than normal on banks to aid crypto and exchanges, based on a senior executive who spoke throughout a meeting from the banks. However, banks must walk an excellent line between receiving encouragement to aid crypto and exchanges and remaining aware of america situation.

The manager ongoing, adding that banks are torn between attempting to offer the development of the company if it’s an insurance policy from the Hong Kong government and fretting about being investigated for potential violations of anti-money washing and know-your-customer rules.

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