• Several Chinese banks have attempted to provide services for Hong Kong crypto firms.
• This is in spite of the ban on crypto activities in China.
• Crypto trading platform OSL has welcomed this move as an indication of traditional financial institutions maturing understanding of the industry.
Chinese Banks Show Interest in Hong Kong Crypto Firms
Several Chinese banks, including Shanghai Pudong Development Bank, the Bank of Communications Co., and Bank of China Ltd., have been seeking to offer services to crypto firms in Hong Kong, despite a ban on crypto on the Chinese mainland. The development has been seen as encouraging by Hong-Kong based crypto trading platform OSL, which believes that it demonstrates a maturing understanding of the cryptocurrency sector by traditional financial institutions.
Crypto Ban on Mainland China
Despite this interest from several Chinese banks, there is still a ban on cryptocurrency activities on mainland China. The recent surge in interest from these banks could point towards a more lenient stance being taken towards cryptocurrencies, however it should be noted that no official change has been made yet.
Cointelegraph reached out to Shanghai Pudong Development Bank, the Bank of Communications Co., and Bank of China Ltd for further comment but did not receive a reply before publication. When asked for comment, Julia Pang, head of banking relations at OSL said that “the firm welcomed growing interest from Chinese banks in engaging with the regulated crypto industry” and that “this development is encouraging for both the industry and the broader ecosystem”.
Interest Ahead Of Licensing Regime
The increasing interest from these state-owned banks comes ahead of a new licensing regime for cryptocurrency exchanges expected to come into effect in June 2021. It will be interesting to see if this increased attention from Chinese banks continues after this licensing regime comes into force or whether it was just a short-term trend sparked by anticipation for upcoming regulations.
It remains to be seen whether or not Chinese state-owned banks will continue their engagement with cryptocurrency firms operating out of Hong Kong after June 2021 when new regulations will come into force. However, it appears likely that any further involvement would indicate an increasingly tolerant attitude towards cryptocurrencies by traditional financial institutions in mainland China – something which could benefit both existing and soon-to-be regulated crypto businesses operating out of Hong Kong significantly.