Hong Kong’s ZA Bank is set to propel local Web3 adoption with its latest initiative, offering specialized banking services tailored for stablecoin issuers.
The announcement on April 5 unveils the virtual bank’s plan to fortify security for fiat reserves, which issuers can utilize to support digital assets.
Stablecoin issuers will gain access to a range of banking services, including fund transfers, payroll management, and various deposit options.
Devon Sin, ZA Bank’s alternate chief executive, expressed the institution’s firm backing for the Web3 community, stating, “With these new services, we’re directly addressing the unique challenges faced by stablecoin issuers, ultimately promoting growth and stability within the Web3 economy.”
The necessity for stablecoin issuers to maintain the value of their assets by securely storing equivalent fiat currency reserves has been a persistent challenge, impeding broader adoption and highlighting a significant requirement within the wider Web3 community.
ZA Bank has been actively engaging with Hong Kong’s burgeoning Web3 sector. In 2023, it reported a transfer volume exceeding $1 billion from clients in the Web3 space.
The bank’s commitment to this sector was evident in May 2023 when it announced its foray into retail virtual asset trading shortly after the Hong Kong Securities and Futures Commission (SFC) signaled its readiness to accept retail virtual asset trading platform (VATP) license applications.
ZA Bank has reportedly captured over 80% of the client banking needs of VATPs in Hong Kong.
Moreover, the bank has facilitated the onboarding of more than 100 Web3 companies as part of its efforts to drive local adoption.
In December 2023, responding to a consultation paper from the Financial Services and the Treasury Bureau and the Hong Kong Monetary Authority, the Hong Kong government revealed its intention to mandate stablecoin issuers to obtain licenses.
The licensing criteria will require stablecoins to be fully backed by reserves “at least equal to the par value.”
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