HKMA Warns Against Misleading Crypto Firms Posing as Banks Amid Hong Kong's Crypto Expansion

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The Hong Kong Monetary Authority, or HKMA, recently issued a warning. They said two overseas crypto firms misrepresented themselves as banks. This could violate the Banking Ordinance. However, the HKMA did not disclose the names of these firms.

In a statement released on Friday, the HKMA explained that one firm claimed to be a bank. The other described its card product as a bank card on its website. This kind of misleading information can confuse consumers.

The HKMA is concerned that people might think these firms are licensed banks in Hong Kong. They want to ensure that consumers understand these products and services are not backed by licensed banks. Such actions might break the law.

Hong Kong has been welcoming to crypto firms. In June 2023, they launched a new licensing regime for crypto trading platforms. This allows licensed exchanges to offer retail trading services. So far, three companies—OSL Exchange, HashKey Exchange, and HKVAX—have received licenses.

Christopher Hui, the Secretary for Financial Services and the Treasury, mentioned last month that the government plans to extend tax concessions for certain investments, including cryptocurrencies, by the end of this year. This shows a clear commitment to supporting the crypto industry.