ZA Bank becomes the first bank in Hong Kong to offer cryptocurrency trading services to retail customers

ZA Bank, the largest digital neobank in Hong Kong, has made a significant move by becoming the first lender in the region to offer retail customers access to cryptocurrency trading. This development allows users to trade Bitcoin and Ethereum using both Hong Kong dollars and U.S. dollars, marking a major step in Hong Kong’s efforts to establish itself as a global crypto hub.

The bank’s announcement on November 25 highlighted a survey by the Hong Kong Association of Banks, which found that nearly 70% of respondents believe bank-backed crypto services could simplify transactions and boost adoption. To make this service accessible, ZA Bank has set a low entry point, allowing users to start trading with a deposit of just $70, and is offering 0% commission for the first three months.

In order to ensure regulatory compliance, ZA Bank has partnered with HashKey Exchange, a licensed crypto platform based in Hong Kong. This partnership also aligns with Hong Kong’s broader initiative to strengthen its position as a leader in the crypto industry, as global user numbers are expected to exceed 560 million by mid-2024.

ZA Bank’s move is part of Hong Kong’s broader push to attract cryptocurrency firms and create a favorable regulatory environment for digital assets. In September, ZA Bank received approval from the China Securities Regulatory Commission to modify its Type 1 license, becoming the first digital-only bank in Hong Kong to gain authorization from the Securities and Futures Commission for regulated activities involving virtual assets.

This launch is significant in the context of Hong Kong’s mandatory licensing for crypto exchanges, which was introduced in 2022, with a deadline for compliance by February 2024. While over 24 companies have applied for licenses, nearly half, including major exchanges like Bybit, Huobi HK, and OKX, have withdrawn their applications, pointing to the challenges crypto companies face in meeting the city’s regulatory requirements.