Hong Kong bitcoin firms are forced to seek banking services on the side.
According to local media reports, Hong Kong's crypto exchange Gatecoin was informed that its bank account was temporarily suspended.
The representative of Hang Seng Bank took such a decision on September 15 without prior notice or detailed explanation. For the Gatecoin backup account, Fubon Bank also set a daily transaction limit that is "significantly lower than the stock exchange," South China Morning Post reported today.
This step caused a shock for Gatecoin and its customers. Thomas Glucksmann, head of marketing at Gatecoin, says that "this is a serious business disruption." According to him, within two or three last months the client base of the exchange increased three times, the price of bitcoin grew steadily, and the number of client deposits also increased.
While in the traditional banking system bitcoin as such does not exist, Hong Kong residents wanting to purchase it must do so through a local bank account. Hang Seng and was a place where the owners of bitcoins could exchange them for fiat money.
Gatecoin does not accept cash or checks. At the same time, the exchange must keep records and control of all its customers, and this makes it dependent on the banking system. Having received such news from the bank, the exchange sent an e-mail to clients, saying that all the transfers were temporarily suspended. Some of the customers were alarmed and decided to call the police, fearing another Mt. Gox.
As a result of this, the freezing of the bitcoin of the Hong Kong firm was forced to open bank accounts abroad for the continuation of operations.
In September, the Hong Kong financial regulator issued a statement reminding the financial community that, despite its popularity and decentralized nature, the ICO must obey the law.
The Securities and Futures Commission statement was made the day after the ICO was completely banned in mainland China.
The SFC approach to startup enthusiasm was much more balanced - she simply noted that some ICO projects fall under the laws on securities and as such require a license, regardless of where they are located.