Beware of Crypto Firms Calling Themselves Banks; Hong Kong Authorities Warns

Hong Kong's main bank, Hong Kong Monetary Authority (HKMA), has alerted peopleabout crypto companies calling themselves "banks". They said some companies even use the word “deposits” for the money they keep for clients. 

In a notice on 16 September, the bank shared that these actions break Hong Kong’s banking rules. Only companies with a special license from the HKMA can call themselves banks or take deposits. The bank warned that money in these fake “banks” is not safe under the Hong Kong Deposit Protection Scheme. To stay safe, people should check the HKMA website for a list of real banks.

The alert came when many crypto companies wanted to get official permission to operate in Hong Kong. The government had recently made it easier for crypto companies to work there. Now, even the general public can use these platforms. But with these new rules, the government needs to watch more closely to make sure companies follow them.

This week, another group, the Hong Kong Securities and Futures Commission (SFC), warned about JPEX, a crypto exchange. They said JPEX was working without the needed permission. The SFC also shared some "strange" things about how JPEX works.

While China is not friendly to crypto, Hong Kong is trying to be a big crypto hub. They see a big chance to grow with Web3 technology. There’s even a group working to help Web3 grow in Hong Kong.