Hong Kong Lawmaker Advocates for Improved Banking Access for Crypto Firms

Johnny Ng, a Hong Kong lawmaker, has called for the relaxation of banking restrictions for cryptocurrency and Web3 companies operating in the region. Ng's comments highlight ongoing challenges faced by these firms in accessing local banking services, despite Hong Kong's push to become a global crypto hub.

Call for Eased Banking Restrictions

In a recent post on X (formerly Twitter), Ng emphasised that Web3 companies are struggling to open bank accounts in Hong Kong, which he argues hampers their business operations. Ng suggests that virtual banks should broaden their services and work in tandem with traditional banks to manage virtual assets, aligning with the government's objectives for Web3 development.

Ng's concerns are supported by a recent survey conducted by his team, which involved over 120 crypto and Web3 firms that entered Hong Kong after 2022. The survey revealed that approximately 95% of these companies attempted to open local bank accounts. However, 70% reported that banks required their shareholders or directors to make multiple visits to Hong Kong. Additionally, 20% of the firms managed to open accounts within two to five months, while 54% faced delays of six months or more.

Ongoing Issues with Crypto Banking

Despite Hong Kong's efforts to attract crypto firms, including the introduction of a crypto licensing regime in June 2023, many companies continue to face significant obstacles. The licensing regime was intended to regulate crypto trading platforms and permit licensed exchanges to offer retail trading services.

However, challenges persist. Duncan Chiu, another Hong Kong lawmaker, has expressed concerns about the "excessively stringent" regulations for obtaining a crypto license. Chiu argues that these stringent requirements have discouraged major global exchanges from entering the Hong Kong market, with firms such as OKX, Gate.io, and HTX withdrawing their license applications.

Moving Forward

Ng's call for reform comes as part of a broader effort to streamline regulatory processes and improve the business environment for crypto and Web3 firms in Hong Kong. By addressing banking access issues and adjusting regulatory requirements, Hong Kong aims to solidify its position as a leading global crypto hub while supporting the growth and integration of emerging technologies in the region.