Interview with Xian Diyun, Alternate Chief Executive Officer of ZhongAn Bank: Virtual assets will become a new growth point

![Interview with Xian Diyun, Alternate CEO of ZhongAn Bank: Virtual assets will become a new growth point] (https://img-cdn.gateio.im/resized-social/moments-69a80767fe-28047c5600-dd1a6f-7649e1)

Xian Diyun, the alternate CEO of ZhongAn Bank (photo courtesy of the interviewee)

Author丨Morii & Alma

EDIT丨Marco

As a virtual bank in Hong Kong, ZA Bank is more receptive to new technologies and industries than its Hong Kong counterparts.

On May 24, Hong Kong-based ZA Bank announced plans to launch virtual asset trading services to retail investors.

ZhongAn Bank was founded by ZhongAn International, a subsidiary of ZhongAn Online Property & Casualty Insurance Co., Ltd. (HKEx stock code: 6060), which is in charge of international business. In March 2019, ZhongAn Bank obtained the first batch of virtual banking licenses issued by the Hong Kong Monetary Authority and officially provided services to Hong Kong citizens in March 2020.

In December 2022, the Hong Kong Securities Regulatory Commission proposed a plan to allow retail investors to trade tokens with large market capitalization. ZhongAn Bank announced the "Banking for Web3" vision in April 2023, providing commercial banking services for Hong Kong licensed exchanges and small and medium-sized enterprises in the Web3 ecosystem, and announced plans to launch virtual asset trading services to retail investors in May.

![Interview with Xian Diyun, Alternate CEO of ZhongAn Bank: Virtual assets will become a new growth point] (https://img-cdn.gateio.im/resized-social/moments-69a80767fe-d4733f655d-dd1a6f-7649e1)

Xian Diyun, the alternate CEO of ZhongAn Bank (photo courtesy of the interviewee)

On July 12, Techub News exclusively interviewed Xian Diyun, the alternate CEO of ZhongAn Bank.

Xian Diyun graduated from the Chinese University of Hong Kong with a major in Global Business. He used to be the deputy director of Standard Chartered Bank (Hong Kong) and was mainly responsible for loan business development. In 2018, he joined ZhongAn Bank as a founding member. He was mainly responsible for participating in formulating business development strategies, developing innovative loan products, and improving digital lending experience.

After Hong Kong issued a declaration on the development of virtual assets, ZA Bank closely followed the policies of the Hong Kong government and planned to launch a series of new measures for virtual asset companies and investors.

In an exclusive interview with Techub News, Xian Diyun pointed out that ZhongAn plans to launch virtual asset trading services, with the goal of providing retail investors with a safe, transparent and convenient platform for digital currency transactions, which will not only meet customers’ growing digital asset investment needs, but also further promote the popularity and acceptance of cryptocurrencies. It said that young people in Hong Kong have a relatively high acceptance of virtual assets, and virtual assets will become a new growth point for banks.

Xian Diyun introduced that the Hong Kong Monetary Authority convened a meeting between Web3 companies and banks and asked banks to guide virtual asset companies on how to open accounts. If mainland Web3 companies want to open a bank account in Hong Kong, they need to register a company in Hong Kong first.

Xian Diyun also revealed that according to market information, Hong Kong regulators are currently focusing on stablecoins, and ZhongAn Bank also hopes to participate in the stablecoin ecosystem as a supporter within the scope permitted by regulation.

**1.**The Monetary Authority communicates with banks to open accounts for virtual asset companies

**Techub News: Not long ago, the Hong Kong Monetary Authority convened Hong Kong banks to discuss virtual asset transactions. Did ZhongAn participate? What are the main concerns of regulators? **

Xian Diyun: That meeting was very public. In addition to banks, there were also many Web3.0 participants and virtual asset participants.

The purpose of the meeting is to allow the bank to give Web3.0 operators a reminder, telling them what materials they need to prepare when opening a bank account in order to successfully open an account to support their operations.

The HKMA is very supportive of the development of this industry, but also understands that banks may have some concerns and concerns. This meeting brings the distance between the bank and other players closer, and the two parties can be more clear about each other's needs.

**Techub News: What is the biggest problem encountered so far in the process of opening a Web3 enterprise account? **

**Xian Diyun:**The biggest bottleneck we are currently encountering may be that some customers need to wait for a long time because our human resources are limited. We need to do a series of customer research work, as well as rigorous due diligence and compliance review, so the whole process may be a little slower. There are currently 30 to 50 customers in line.

**Techub News: If some projects want to land in Hong Kong, what should they do if they first want to open an account with you? **

Xian Diyun: It's very easy, you can contact our account manager, we will arrange according to the needs and priorities of customers.

A simple company may take two or three weeks, but if a company has a complex structure, it will take more time to do a penetration research.

**Techub News: What is the process to open this type of account? **

Xian Diyun: At present, the account opening process is mainly carried out offline. We need to meet with the owner of the applying company to get their signature. Of course, for some companies with a relatively simple corporate structure, such as Hong Kong companies or ultimate shareholders in Hong Kong, they can fill in the information through our online technology and download our APP for face recognition. Such an online account opening process can be completed within two days.

**Techub News: What are the requirements for the account holder? **

**Xian Diyun:**Because now we only support bosses with Hong Kong ID cards, and we don’t have too many requirements for others, and new companies are also very welcome.

**Techub News: If Web3.0 entrepreneurs in mainland China want to open an account in Hong Kong, will they be any different from entrepreneurs in Hong Kong? **

**Xian Diyun:**First they need to register a company in Hong Kong. After they have a company, they can apply for a bank account. This process is the same as other companies in Hong Kong.

**Techub News:****Because Web3.0 companies basically have no legal currency capital flow, and they may not have opened a bank account, some even have a multi-signature wallet as the main body of the company. Will this bring difficulty to them to open an account? **

**Xian Diyun:**Our bank does not accept virtual assets, only legal currency. For such a company, the easiest way is to go to a licensed exchange in Hong Kong to open an account, then convert the cryptocurrency into legal currency through the exchange, and then deposit it into our bank's legal currency account.

**2.**Virtual assets are a new growth point

**Techub News: ZhongAn Bank’s business on Web3, what specifically does it include? **

**Xian Diyun: **Start with corporate business first, support licensed exchanges or exchanges that are interested in applying for a license.

On the other hand, we are also studying how to provide virtual asset trading services from the bank side under the premise of meeting regulatory requirements. Of course, this needs to wait until the retail license is issued to the exchange before we can cooperate with these exchanges.

**Techub News: The public business cooperates with the licensed exchange, what about the retail business? Does ZhongAn plan to apply for a license and develop a trading system by itself? **

**Xian Diyun:**The retail business will not apply for an exchange license in the short term. We currently have more than 650,000 retail customers and our focus is to provide quality services to these customers. Therefore, they tend to cooperate with exchanges to provide customers with one-stop financial services, including virtual asset trading.

**Techub News: If you want to cooperate with a licensed exchange, which licenses do you need to apply for? **

Xian Diyun: At present, we already have the first type of license issued by the Hong Kong Securities Regulatory Commission, that is, a securities trading license, so we can provide fund investment services. In terms of providing virtual asset trading services, we will continue to prepare and communicate with regulatory authorities in a timely manner.

**Techub News: How is your cooperation with compliant exchanges going? **

**Xian Diyun:**In Hong Kong, there are currently only two licensed exchanges, and they only serve institutional investors and professional investors, because they have not yet obtained retail qualifications.

We have carried out in-depth cooperation with these two exchanges, trying to provide some products for public business, such as docking with their API interface, so as to improve the efficiency of fiat currency in and out and virtual currency transactions during virtual asset transactions.

**Techub News: You just mentioned that there are more than 650,000 retail users. How many of these users are interested in virtual asset transactions? **

**Xian Diyun:**We don't have specific figures. But about two-thirds of the more than 650,000 customers are young people, between the ages of 20 and 30, who are more interested in virtual assets. This is why we believe that virtual asset trading is a new space for expansion and may become a new growth point.

**3.**Can open an account for tourists visiting Hong Kong

**Techub News: When participating in the virtual asset trading business, does ZhongAn Bank need to form a new technical team to support the new business? **

**Xian Diyun:**Of course, virtual asset trading is a new field, and we need to absorb talents from the market to support our development. As the largest virtual bank in Hong Kong, we are always looking for suitable talents. In fact, we believe that virtual asset trading is very suitable for our business development.

**Techub News: You just mentioned that you are good at solving problems technically. Can you give some specific cases? **

**Xian Diyun:**First of all, as a virtual bank, our customers mainly open accounts through the APP. We have independently developed an eKYC system for personal identification. This core technology can identify users as well as their credentials.

Although there are many similar products available in the market, we chose to develop our own for two reasons: one is that the cost is lower; two, we can iterate faster to deal with issues such as the risk of fraud.

In addition, our system can support Hong Kong residents and visitors to Hong Kong at the same time. They can use our technology to open Hong Kong accounts through Hong Kong and Macau travel permits and mainland ID cards. This is one of our innovations.

**Techub News: You just mentioned that ZhongAn Bank attaches great importance to user experience, especially in digital currency transactions. So how does ZhongAn Bank consider and design the user experience? **

Xian Diyun: First of all, as a bank, we must ensure customer confidence and make customers feel that they are dealing with the bank. Therefore, system stability is very important. Secondly, we will choose to cooperate with the most confident licensed exchanges so that they can provide quality services to our customers.

We will start from two aspects, one is to ensure security, and the other is to simplify services. Because for novices, investing in digital currency may involve many complicated matters, such as adding accounts, handling wallets, etc. We wish ZA Bank would provide an easier solution.

4.** will participate in Hong Kong's stablecoin industry from a custody perspective**

**Techub News: When deploying virtual asset trading business, will there be competition between traditional banking industries? **

Xian Diyun: I think there will be competition between us and traditional banks, because everyone is in the banking industry.

The field of virtual assets is a very new concept to the banking industry. We will provide high-quality services to the exchange from the aspect of public business to improve the smoothness of the transaction process. From the retail side, we will consider whether to provide customers with virtual asset trading services.

In the future, more banks may participate in this field, which is a good thing for the whole market and will help the development and growth of the market.

**Techub News: Virtual assets fluctuate greatly. What risk control measures do you have in place for volatility risks? **

Xian Diyun: We need to conduct questionnaire surveys on customers to assess their acceptance of risks. We will select those customers who can accept higher risks in the risk assessment and provide them with relevant products.

**Techub News: What do you think of the stable currency track, and how will banks participate in this track? **

Xian Diyun: At present, the stable currency is still in the process of regulatory transparency. We will consider participating from a custody perspective, such as hosting the fiat currency of companies that issue stablecoins. We will focus on how to better manage fiat currency and promote the healthy development of the stablecoin ecosystem. In my opinion, stablecoins are an important milestone in the development of virtual markets. At present, the regulatory license of Hong Kong Exchange does not involve stable coins, such as USDC and USDT. As such, we will continue to monitor Hong Kong for possible additional support measures in the stablecoin space.

**Techub News: If ZhongAn Bank enters the custody service in the stablecoin field, what is the core advantage of ZhongAn compared with other banks? **

Xian Diyun: For hosting services, our advantage is that we have provided high-quality services for exchanges. If we can provide stablecoin issuers with the same high-quality services, we will gradually form a closed loop from fiat currency to stablecoin and then to other virtual assets. This will reduce transaction costs and improve transaction efficiency. We hope to connect key players in the field of virtual assets to provide better services to customers.

**Techub News: Does ZhongAn plan to launch futures ETFs for Bitcoin and Ethereum? **

Xian Diyun: There is no such plan at present, and it is possible to observe the market reaction when preparing to launch the US stock market, and then decide whether to provide ETF trading.