HONG KONG &ndash DBS Group Holdings plans to apply for a licence that allows it to offer crypto trading services to Hong Kong customers as the Chinese territory pushes to become a hub for digital assets.

 

&ldquo We are planning to apply for a licence in Hong Kong so that the bank can sell digital assets to our Hong Kong customers,&rdquo said Mr Sebastian Paredes, chief executive of DBS Bank (Hong Kong), at a briefing in Hong Kong on Monday.

 

The city is pushing to attract digital asset businesses, and Hong Kong Financial Secretary Paul Chan said last month that it remains committed to becoming a regional crypto hub.

 

In a major policy shift from China, Hong Kong&rsquo s government is considering allowing increased access to retail investors to trade in cryptocurrencies and crypto exchange-traded funds. 

 

Mr Paredes said DBS remains sensitive to the risks associated with digital assets but welcomes Hong Kong&rsquo s recent policy shift.

 

When the regulations in Hong Kong are clear and the bank &ldquo understands exactly the framework&rdquo , DBS will be one of the lenders interested in participating, he said.

 

DBS launched a crypto exchange in Singapore for corporate and institutional investors in late 2020. In September last year, it announced plans to expand its DBS Digital Exchange and offer services to more of its wealthy clients in Asia &ndash including private banks, accredited investors and other exchanges &ndash despite the crypto bear market.

DBS has also been working on decentralised finance technology in joint projects with Singapore&rsquo s central bank.

 

Singapore has taken a more cautious approach to the industry, with its leaders stressing that the Republic is open to digital asset innovation, but not to crypto speculation. In October, the Government proposed to ban retail investors from borrowing to fund crypto purchases, part of a slew of suggestions to further tighten the regulatory regime for digital assets.

 

The crypto industry, meanwhile, has seen the collapse of a number of heavyweights, most notably crypto exchange FTX and stablecoin TerraUSD, with cryptocurrencies losing some US$2 trillion (S$2.6 trillion) in value since the height of a massive rally in 2021. The knock-on effects also saw the failure of Singapore-based entities such as hedge fund Three Arrows Capital and crypto lender Hodlnaut. BLOOMBERG