Hong Kong Pushes Banks to Embrace Crypto Clients

Hong Kong's Monetary Authority (HKMA) is reportedly urging banking giants like HSBC, Standard Chartered, and Bank of China to consider crypto exchanges as clients, as per Financial Times. The HKMA, in an April letter, emphasized that due diligence for potential clients should not pose an "undue burden", particularly for those establishing offices in Hong Kong.

Hong Kong aims to become a global crypto nexus, as its Securities and Futures Commission (SFC) has recently started accepting applications for crypto trading platform licenses. The move aligns with legal actions against major crypto exchanges like Binance and Coinbase by U.S. authorities.

During a meeting last month, HKMA asked HSBC, Standard Chartered, and Bank of China why they were not accepting crypto exchanges as clients, the FT reported. This inquiry comes amid resistance from traditional banking mindsets.

Globally, banks and crypto companies have had complex relationships. Instances of payment processors severing ties with local exchanges in India last year, and recent reports of Australian banks blocking crypto exchange payments, illustrate this. Fear of potential legal issues linked to scams contributes to banks' hesitance to engage with the crypto industry.

Spokespersons from HSBC and Standard Chartered affirmed their active dialogue and engagement with regulators and virtual asset players regarding account openings and industry developments. The Bank of China and HKMA have yet to comment.