Beware of Crypto Firms Using the Word ‘Bank’, HKMA Cautions
by Fintech News Hong Kong September 18, 2023The Hong Kong Monetary Authority (HKMA) has issued a warning to the public to be wary of crypto firms that describe themselves as “banks” or offer “deposits.”
The central bank found that some crypto firms are using terms such as “crypto bank,” “crypto asset bank,” “digital asset bank,” “digital bank,” or “digital trading bank,” or claiming to offer “banking services” or “banking accounts.”
Some firms also use the word “deposits” to describe funds placed with them by clients, or promote “savings plans” as “low risk” with “high returns” which are misleading the public.
The HKMA reminds the public that only licensed banks, restricted license banks, and deposit-taking companies can carry out banking or deposit-taking business in Hong Kong.
Crypto firms are not regulated by the HKMA, so their funds are not protected by the Hong Kong Deposit Protection Scheme.
HKMA urged the public to be vigilant and to exercise caution when dealing with crypto firms. They can check the register of authorised institutions on the HKMA’s website or call the HKMA’s Public Enquiry Service hotline (2878 8222) for assistance.
