According to a local source, ZA Bank, Hong Kong’s largest virtual bank, has become the first digital-only bank to receive approval from the Securities and Futures Commission (SFC) for Type 1 regulated activity.
This approval allows ZA Bank to enter the world of cryptocurrency trading. It comes as Hong Kong tightens its grip on unlicensed exchanges and encourages the development of a regulated crypto ecosystem.
This achievement follows a year of preparations as ZA Bank, a unit of China’s ZhongAn Online P&C Insurance, explored virtual asset-related services. The Bank is now fully capitalizing on Hong Kong’s new crypto regulations that came into effect in June 2023.
ZA Bank SFC Approval: What Does It Mean For Crypto Hong Kong?
ZA Bank made headlines in May of this year when it expressed interest in offering virtual asset-related services once new crypto regulations were implemented.
This foresight and strategic planning paid off, as the SFC approved ZA Bank in September, allowing it to provide cryptocurrency trading services under Hong Kong’s revamped regulatory framework.
The approval is a significant victory for ZA Bank as a leader in digital banking, not just in Hong Kong but potentially across Asia.
The bank’s CEO, Rockson Hsu, highlighted the importance of this achievement, noting that the approval represents a “game-changing” development in ZA Bank’s mission.
“We look forward to further enhancing user experience with our game-changing investment fund services.”
The bank’s plans to launch an investment fund service next further stressed its strategic commitment to providing a full suite of digital financial services.
This breakthrough comes after Hong Kong introduced new regulations in 2022, requiring all crypto exchanges operating in the city to submit license applications by February 2024.
Over 24 companies, including major players like OKX and Bybit, have been vying for licenses, and the competition has been fierce.
Hong Kong’s Push to Become a Global Crypto Hub
In recent years, the city has faced stiff competition from other crypto-friendly hubs like Singapore and Dubai.
However, Hong Kong has responded by introducing a comprehensive regulatory framework to make the city a top destination for crypto exchanges and digital asset firms.
This regulatory shift began in 2022, when Hong Kong implemented new rules requiring all exchanges to apply for a license by February 2024.
By May of this year, unlicensed exchanges were forced to shut down, and the SFC issued warnings to investors to only use licensed platforms.
This crackdown has created an environment where licensed entities like ZA Bank can thrive, offering regulated, secure platforms for digital asset trading.
ZA Bank’s approval also comes from Hong Kong’s Securities and Futures Commission, which has taken steps to legitimize the crypto space further.
Earlier this year, the SFC also approved Asia’s first exchange-traded funds (ETFs) tied directly to Bitcoin and Ether, which started trading on the Hong Kong Stock Exchange.
Furthermore, ZA Bank’s expansion into the virtual asset sector aligns with Hong Kong’s efforts to attract global crypto investors.
CEO Ronald Iu previously stated that the bank is committed to supporting Web3 startups, a growing sector that is expected to drive much of the future demand for digital assets.
The launch of the new licensing program and the lifting of the retail crypto trading ban in 2023 clearly indicate that Hong Kong is positioning itself as a major player in the global crypto space.
ZA Bank’s next move is to launch its investment fund service, which is currently in development.
The post ZA Bank Gains SFC Approval for Type 1 Regulated Activity appeared first on Cryptonews.
