As the Signature Bank and Silvergate collapses sent crypto firms into a feud, a Hong Kong virtual bank is giving a warm welcome to web3 startups.
Hong Kong-based ZA Bank can now serve as the bank of liquidation for regulated web3 companies in the city, the company has has communicated at the Hong Kong web3 festival, an event backed by the region's government and which has attracted crypto startups and institutions from across Asia.
The online bank is set up to facilitate cryptocurrency to fiat currency conversions in conjunction with two authorized exchanges in Hong Kong, HashKey and OSL, where customers can trade cryptocurrencies for fiat currencies. In other words, the crypto-fiat part of the conversion is happening on the regulated exchanges instead of ZA Bank directly.
ZA Bank is likely to settle transactions for more crypto exchanges as more companies apply for digital asset permits from Hong Kong authorities.
In addition, ZA Bank, which was established by Chinese online insurer ZhongAn in 2017 as one of Hong Kong's first virtual banks, has started offering basic banking services to local web3 start-ups, a category of businesses highly underserved by traditional financial institutions.
It will be interesting to see if the handful of others Online banks in Hong Kong will follow suit to compete for customers from web3 and whether ZA Bank's offer will attract more cryptocurrency companies to set up shop in the Asian financial center.
The movement is happening at a time when Hong Kong is trying to position itself as a friendly alternative with cryptocurrencies to other hubs like the US and Singapore and acts as a sandbox for web3 companies They originate from China, where cryptocurrency trading is illegal. The city has been revamping its digital asset regulatory framework, which tentatively plans to legalize retail trading in major cryptocurrencies like Bitcoin and Ether.
"While Hong Kong is stepping up efforts to cultivate a Web3-compliant environment, ZA Bank's online account opening for Web3 startups represents a big step forward in integrating traditional banking services with the Web3 world," said Ronald Iu, CEO of ZA Bank. .
“It signifies greater acceptance and recognition of the importance of this emerging sector and will hopefully encourage other financial institutions to follow suit and offer personalized banking services for Web3 businesses. We look forward to exploring collaborations with global companies web3 key like HashKey, OKX and more”.
