Hong Kong Put Pressure on Three Major Banks to Take on Crypto Exchanges as Clients: Report

The Hong Kong Monetary Authority (HKMA) is putting unit connected HSBC, Standard Chartered and Bank of China to instrumentality connected crypto exchanges arsenic clients, the Financial Times reported connected Thursday citing 3 radical with cognition of the substance and a letter.

"Due diligence connected imaginable customers should not “create undue burden”, peculiarly “for those mounting up an bureau successful Hong Kong to look for the opportunities here”, the April 27 missive from the HKMA said to the banks, reported the Financial Times.

Hong Kong has taken caller steps to look arsenic a planetary crypto hub – its Securities and Futures Commission (SFC) began accepting applications for crypto trading level licenses connected June 1, and a Hong Kong lawmaker invited Coinbase to travel and registry successful the region. Hong Kong's ambitions coincides with lawsuits by U.S. authorities against the world's biggest cryptocurrency exchanges, Binance and Coinbase.

The UK-based HSBC and Standard Chartered, and Bank of China were asked by HKMA astatine a gathering past period wherefore they were not accepting crypto exchanges arsenic clients, according to the FT. The 3 banks are among the largest successful the world. The Bank of China is Chinese bulk state-owned.

“HKMA encouraged the banks to not beryllium afraid,” FT quoted a idiosyncratic with cognition of the discussion. “There is absorption from a accepted banking mindset...we are seeing immoderate absorption from elder executives astatine accepted banks.”

Banks and outgo settlers person had a tricky narration with crypto companies globally. Last year, immoderate outgo processors cut off section exchanges successful India, and precocious reports person emerged that Australia's banks person been blocking payments to crypto exchanges. While nary prohibition connected crypto clients exists, Banks look to beryllium reluctant to prosecute with the manufacture for fearfulness of ineligible challenges successful the lawsuit of a scam.

HSBC, Standard Chartered, Bank of China, and HKMA did not instantly respond to CoinDesk's requests for comments. Standard Chartered and HSBC told FT they engaged with regulators connected a regular ground connected policies and developments successful this industry.