HSBC revealed that the bank has no plan to offer virtual currency as investments to their clients by starting a cryptocurrency trading desk due to volatility and uncertain transparency, the CEO said Monday.
Noel Quinn, CEO of HSBC, accepted an interview from Reuters on Monday said the bank has no plans or offer digital coins for their clients as investments by using cryptocurrencies as a trading medium.
“Given the volatility we are not into Bitcoin as an asset class, if our clients want to be there, then of course they are, but we are not promoting it as an asset class within our wealth management business”.
Quinn expressed his scepticism towards cryptocurrencies; part of the reasons was the difficulty of assessing the transparency of holders and the risk of its convertibility into fiat money, according to the news agency.
“I view Bitcoin as more of an asset class than a payments vehicle, with very difficult questions about how to value it on the balance sheet of clients because it is so volatile,”
He further explained that the system needs stable coins to reserve to address the stored value concerns. However, it depends on who the sponsoring organisation is, plus the structure and accessibility of the reserve.
However, Quinn said he believes in central bank digital currencies (CBDC), saying that CBDCs can simplify and facilitate international transactions in e-wallets and take out friction costs.
Meanwhile, a senior management member from HSBC- Paul Mackel, said on CNBC’s programme on Monday that Beijing’s recent attempt to tighten crypto regulations was not a “new development”, indicating China took a more “cautious” stance on crypto affairs.
Mackel argued that China’s recent decisions aimed to replace cash in circulation and did not directly conflict with launching its digital yuan.
Three Chinese regulatory units, including NIFA, CBA, and PCAC, prohibited banks and financial firms early from providing cryptocurrencies transaction services early. Last week, China said that tightening crypto regulation was necessary to “crackdown on Bitcoin mining and trading behaviour” for protecting the financial system.
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