Hong Kong’s ZA Bank Explores Virtual Asset Services Amid Regulatory Changes

Hong Kong’s ZA Bank, a subsidiary of China’s ZhongAn Online P&C Insurance, is considering entering the virtual asset market following the implementation of new regulations for digital assets in the region. These regulations, established last year, require all crypto exchanges to apply for licenses by February 2024, with 24 companies currently vying for these licenses. Approval from the Securities and Futures Commission (SFC) is highly coveted, positioning Hong Kong as a prestigious regulatory hub.

Ronald Iu Man-chung, CEO of ZA Bank, revealed plans to offer virtual asset trading services for retail investors pending final preparations. However, specific details regarding the services will be announced once these preparations are complete. ZA Bank’s interest in virtual asset services comes amidst a stricter regulatory landscape in Hong Kong, with the SFC urging investors to use only licensed platforms and unlicensed exchanges facing closure by May 31.

Currently, only OSL Digital Securities and Hash Blockchain hold licenses for virtual asset trading in Hong Kong, while other prominent players like OKX and Bybit await approval. The SFC is expected to publish a list of approved and rejected applications for virtual asset trading platforms by June 1, 2024. Hong Kong recently approved Asia’s first exchange-traded funds (ETFs) tied to Bitcoin and Ether, signaling a renewed interest in crypto trading.

The move by ZA Bank aligns with Hong Kong’s broader push to support the digital asset sector and position itself as a major crypto hub. As the regulatory landscape evolves and financial institutions like ZA Bank explore virtual asset services, Hong Kong aims to regain its position as a prominent crypto-friendly jurisdiction.