Standard Chartered-owned crypto firm Zodia launches in Hong Kong

Zodia Custody, the cryptosecurity company owned by the British banking giant Chartered Standardis launching its services in Hong Kong, the company exclusively told CNBC.

It marks the UK-based company's latest push into the Asia-Pacific region. Founded in 2020, Zodia Custody helps financial institutions store their cryptocurrencies securely.

Zodia CEO Julian Sawyer said Hong Kong was a market where demand for cryptocurrencies is driven by institutions, rather than retail customers, adding that this is the ideal clientele for Zodia.

“The Hong Kong government and regulators see digital assets as the future and also want Hong Kong to be a hub,” Sawyer said.

Zodia has been expanding aggressively in Asia. In fact, the company opened its services in Japan, Singapore and Australia in recent months. It is part-owned by Standard Chartered, as well as Northern Trust and SBI Holdings of Japan.

Hong Kong is the last stop on Zodia's tour of the Asia-Pacific region, Sawyer said.

"What we're seeing is that there are absolutely customers in those four markets that want to do things," he added.

"We also see a lot of other clients and prospects outside of those four jurisdictions who want to get into the institutional side."

Hong Kong has been moving closer to crypto assets despite a broader anti-crypto push by China, which banned bitcoin trading and mining in 2021.

The Hong Kong Securities and Futures Commission (SFC) launched a regulatory regime for digital assets earlier this year, giving companies the ability to apply for registration and offer their services in a regulated manner.

So far, only two companies, OSL Digital and Hash Blockchain, have received licenses from the SFC.

Zodia is embarking on its expansion in Hong Kong gradually. At first, it will look to serve Hong Kong clients in a limited set of crypto assets.

Zodia is also in talks with the SFC and the Hong Kong Monetary Authority about the possibility of regulating in the financial district.