According to Coincu, the Hong Kong Monetary Authority (HKMA) has warned cryptocurrency businesses against using terms from the banking industry improperly. The central bank is worried that these actions could lead people to believe that these organisations are legitimate banks in Hong Kong. Only licenced institutions are permitted to conduct banking or deposit-taking activities within the territory in accordance with the Hong Kong Banking Law.
The use of words like “crypto bank,” “digital asset bank,” or “crypto asset bank” to describe services or represent to offer banking services or accounts is particularly discouraged by the HKMA as doing so may be illegal. The central bank also made it clear that anyone or any company cannot use the word “bank” in their company name or description unless they have the necessary licence. The HKMA also emphasises that non-bank cryptocurrency businesses are not subject to central bank regulation, meaning that funds kept in “cryptocurrency banks” are not covered by the region’s deposit insurance programme.