Hong Kong ZA Bank to Offer Crypto Accounts and Conversion

Jimmy Aki
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ZA Bank, Hong Kong’s largest virtual bank in terms of assets, plans to offer crypto account services and streamline crypto-to-fiat exchanges.

These account services arrive when American businesses are having trouble finding local banking partners and regularly setting their sights outside the country.

A New Welcome Offer for Crypto Firms

Following the failures of Signature Bank and Silvergate, ZA Bank, a virtual bank in Hong Kong, is welcoming Web3 startups.

The Hong Kong-based ZA Bank announced that it is now authorized to function as the settlement bank for regulated web3 enterprises in the city at a recent Web3 festival in Hong Kong, which is supported by the local government and draws crypto entrepreneurs and institutions from all over Asia.

According to a Bloomberg report, the bank also provides account services to cryptocurrency firms and will serve as a settlement bank. This will enable the withdrawal of token deposits at authorized exchanges in Hong Kong dollars, US dollars, and Chinese yuan.

Along with HashKey and OSL, two authorized exchanges in Hong Kong, the online bank will make it easier for users to convert their cryptocurrency holdings into fiat money.

In other words, rather than going through ZA Bank directly, the crypto-fiat conversion process happens across the licensed exchanges.

The accounts for local crypto enterprises come after a trial in a regulatory sandbox in which about 100 firms took part. However, ZA Bank CEO Ronald Iu asserted that clients from mainland China are exempt from the service due to the country’s regulations.

ZA Bank will probably be processing transactions for additional crypto exchanges as more businesses submit applications for Hong Kong government-issued digital asset permits.

Furthermore, ZA Bank, one of Hong Kong’s first virtual banks founded in 2017 by Chinese online insurer ZhongAn, has begun to provide basic banking services to regional Web3 companies, a market segment largely untapped by traditional financial institutions.

A Potential Solution to Crypto Banking

The news from ZA Bank comes in the wake of a determined attempt by Hong Kong officials to establish the province as a hub for cryptocurrency.

After the failure of crypto-friendly banks such as Silicon Valley Bank, Silvergate Bank, and Signature Bank, crypto businesses in the U.S. are struggling to find banking partners. The Hong Kong-based ZA Bank appears to be offering the firms an alternative.

This action is occurring when Hong Kong is attempting to position itself as a crypto-friendly alternative to other hubs, such as the United States and Singapore, as well as serve as a sandbox for Web3 enterprises based in China, where cryptocurrency trading is prohibited.

The municipality has been updating its legislative framework for digital assets, which has a tentative proposal to legalize retail trading of significant cryptocurrencies like Bitcoin and Ether.

Many in the crypto community feel Hong Kong’s approach – in contrast to the animosity of U.S. regulators – will aid it in its endeavors.

Reports are also circulating that Chinese state-owned banks have shown interest in the crypto enterprises coming into their city and are either offering banking services to them or contacting them.

Ronald Iu, CEO of ZA Bank, stated that the account opening for Web3 startups represents a significant advancement in integrating traditional banking services with the Web3 world, especially when Hong Kong is stepping up efforts to develop a Web3-friendly environment.

According to the CEO, this indicates a stronger understanding and appreciation of the significance of the developing industry. He hopes it will inspire other financial institutions to provide specialized banking services for Web3 businesses.

He further stated that the bank is looking forward to developing partnerships with significant international Web3 companies like HashKey, OKX, and more.

It will be interesting to see if a few other Hong Kong online banks follow suit to compete for Web3 customers and if ZA Bank’s offering will entice other crypto businesses to open offices in the Asian financial hub.

About Jimmy Aki PRO INVESTOR

Based in the UK, Jimmy is an economic researcher with outstanding hands-on and heads-on experience in Macroeconomic finance analysis, forecasting and planning. He has honed his skills having worked cross-continental as a finance analyst, which gives him inter-cultural experience. He currently has a strong passion for regulation and macroeconomic trends as it allows him peek under the global bonnet to see how the world works.