Tencent to Build Virtual Bank After Hong Kong Regulator Approves License

Chinese internet giant Tencent is set to open a blockchain-based virtual bank after the Hong Kong Securities and Futures Commission (SFC) approved a new license.

Speaking at the World Blockchain Summit in Wuzhen, China on Friday, Tencent blockchain chief Yige Cai said the company's virtual bank received the SFC's green-light. Moving forward, the company will assemble a team to support the blockchain-based banking platform, according to Chinese media site Sina Finance.

"Hong Kong’s new regulations and supervision on digital assets transactions validates the importance of blockchain technology and digital assets, which is good news for the whole industry," Cai said in his speech at the summit. 

The SFC has granted virtual bank licences to 12 entities so far. On the list is Infinium Limited, a joint venture between Tencent, Industrial and Commerce Bank of China (ICBC) and other two Hong Kong-based institutional investors.

Tencent renamed Infinium to Fusion Bank in July after it received the license in May. 

Cai did not disclose further details about the virtual bank, while stressing Tencent’s existing  blockchain projects, including the offering of a supply chain financing for global fast food chain restaurant McDonald’s, according to the report. 

According to another report, Cai is currently leading the consortium blockchain group out of the three blockchain development groups in Tencent. The other two are responsible for blockchain infrastructure and its blockchain-based cloud services, respectively. 

Other companies include Alibaba’s fintech arm Ant Financial and SC Digital Solutions Limited, whose 65 percent stake is owned by Standard & Chartered Bank.  

The SFC published details about its new licensing system to regulate virtual asset transactions on Wednesday, creating a similar framework to the one overseeing securities brokers.

Tencent image via testing / Shutterstock