Crypto dealers find willing partners at Hong Kong banks seeking to fill SVB void amid city’s virtual asset push

Hong Kong’s licensed digital asset trading platforms are partnering with both local virtual banks and larger Chinese institutions

As the city prepares new licensing requirements and greater retail participation, more competitors are expected navigate tough requirements to enter the market

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Published: 6:00pm, 21 Apr 2023

Crypto platforms in Hong Kong are opening accounts and partnering with local banks, as the city attracts more market players ahead of passing its new licensing regime as part of an effort to become a virtual asset hub.

Online-only financial institution ZA Bank was one of the first in the city to start offering services to crypto firms. The company announced this month that it would service digital asset conversions and accounts. However, insiders note that larger, more traditional banks are also looking to tap into virtual assets.

Last week, Hashkey Group, a digital-asset service provider based in Hong Kong, announced a partnership with ZA Bank and the Hong Kong arm of China’s state-owned Bank of Communications to launch a virtual asset trading platform called HashKey Pro, which will facilitate trades in some major cryptocurrency tokens.

“Our partnership with local virtual bank ZA Bank is only a starting point, and we plan to collaborate with other financial institutions to offer our clients a diverse range of solutions,” Hashkey Pro CEO Colin Zhong said.

Opportunities for such moves come a month after the bankruptcies of Silicon Valley Bank (SVB) in California and Signature Bank in New York, both known for servicing crypto companies. Hong Kong’s recent moves to embrace the virtual asset industry have separated it from markets like the US, which has recently taken a much tighter regulatory approach, and mainland China, where cryptocurrencies are banned.