By James Davis
The Singapore-based bank DBS has announced plans to pursue the Hong Kong market. DBS intends to acquire a license from the regulators to provide crypto services to Hong Kong users. A report from Sebastian Paredes, the chief executive of DBS, confirmed that the bank desires to be the first crypto-friendly bank in Hong Kong.
DBS Enter Hong Kong
A statement from the DBS management dated February 13 portrayed that the bank is a compliant firm since it announced its willingness to adopt new changes in crypto policies. The report revealed that the bank is keen to identify and mitigate the risk related to digital assets.
In 2020, the largest bank in Singapore invested in integrating a crypto exchange system DBS Digital Exchange. The platform aimed at improving the trading experiences of institutional and consumer investors. The DBS digital platform has enabled traders to transact with leading crypto assets, including Bitcoin(BTC), Ethereum (ETH), and Bitcoin Cash (BCH).
After the launch of the Digital Exchange, DBS has made an indispensable contribution to expediting crypto transactions for retail investors. The efforts have inspired the megabank to explore the decentralized finance (DeFi) platforms in partnership with the central bank of Singapore.
DBS Market Performance
Despite the uncertainty in the digital market, DBS yielded a net profit of $6.7B in 2022, a 20% increase from 2021. The bank’s report shows it generated an income of $16.5B in the last trading year.
DBS has joined other crypto exchanges, such as Huobi, in pursuing the Hong Kong market. Recently, Hong Kong ranked as the lead crypto-friendly country in Asia as China is gearing toward developing digital regulations.
Why are Companies Expanding to Hong Kong?
On January 9, an official from the financial secretary Paul Chan confirmed that Hong Kong is aiming to become a crypto hub. Chan encouraged FinTech firms and crypto exchanges to support the Hong Kong government improve the country’s crypto infrastructure. In response to Chan’s report, digital asset companies are interested in entering the Hong Kong market.
Before this, legislators in Hong Kong demanded a licensing system for virtual asset operators. In 2022, the legislators requested the entrepreneurs to share their input on licensing conditions before passing the bill into law.
The recent amendment in digital laws aims to improve cryptos’ market performance to match the success of the traditional financial sector.
Despite Hong Kong’s positive stance on crypto, other countries, such as Singapore, prioritize formulating stricter digital asset regulations. Following the prolonged ripple effect from the collapse of the Bahamas-based exchange FTX, the regulators in Singapore imposed a ban on crypto credit activities. Last October, the embattled hedge fund Three Arrows Capital triggered the monetary authority in Singapore to be more strict on crypto regulations.