HKMA Warns of Misrepresentation by Crypto Firms

The Hong Kong Monetary Authority (HKMA), the de facto central bank, issued a warning today regarding two overseas cryptocurrency firms that misrepresented themselves as banks. This alert coincides with local regulators’ increased efforts to combat fraud as Hong Kong positions itself as a crypto hub.

In a statement released on Friday, the HKMA noted that one of the overseas crypto firms claimed to be a bank, while the other described its card product on its website as a bank card.

>The HKMA expressed concern that these claims mislead consumers into believing these firms are licensed banks in Hong Kong and are under the supervision of the HKMA. The HKMA stated, "Such products and services are provided by licensed banks in Hong Kong. Such acts may constitute a contravention of the Banking Ordinance."

The HKMA did not reveal the identities of the two firms. The Block has reached out for further comments.

Hong Kong has actively welcomed crypto firms; in June 2023, it officially launched a crypto licensing regime for trading platforms, permitting licensed exchanges to offer retail trading services. So far, the regulator has granted licenses to OSL Exchange, HashKey Exchange, and HKVAX.

Christopher Hui, Secretary for Financial Services and the Treasury, indicated last month that the government intends to extend tax concessions for specific investments, including cryptocurrencies, by the end of this year.