Every cryptocurrency company worth its salt prioritizes two key goals: transparency and absolute security. InVault, a Shanghai-based cryptocurrency startup, appears ready to meet these critical concerns. The company has announced plans to launch cryptocurrency custodian services in Hong Kong. This represents a significant step forward for the startup.

InVault’s decision to open a Hong Kong office is strategically sound. The startup will benefit from new rules set by the country’s financial regulator. Earlier this month, Hong Kong’s Securities and Financial Commission (SFC) issued new cryptocurrency licensing requirements. These rules make insurance mandatory for all exchanges and fund managers operating in the country. They must now insure their digital assets.

According to the SFC, insurance policies must provide specific coverage levels. Full coverage is required for virtual assets held in hot storage. Substantial coverage is needed for assets in cold storage. The organization recommends 95% coverage for cold storage assets.

InVault Expands in Hong Kong

In mainland China, InVault has arrived at one million Ethereum already. Subsequently, the company, which has obtained a new trust license from the Financial Commission, will open its doors to the public from December. The startup is already predicting that it “may expand its reach across the region” because it is fully compliant with the regulations given by the SFC. Thanks to the new license, InVault now has the ability to offer Hong Kong its custodian services within the ambit of the law.

InVault has no plans to stop at just offering custodian services, however. Founder and Chief Executive Officer of the firm, Kenneth Xu, believes that the company can also offer a “regulated conduit” among traditional financial institutions and cryptocurrency-related companies.

Xu also disclosed that he is currently holding talks with “two mid-sized insurers” for the provision of coverage, which the startup plans to include in its custody services. He also elaborated on the risk factor facing insurers.

“The biggest challenge for insurers today is how to accurately measure the risk profile of a custodian, and its internal systems, to price the cryptocurrency insurance premium accordingly,” Xu added.

In conclusion

InVault, a cryptocurrency startup based in Shanghai, is opening an office in Hong Kong. The company, which offers custodian services to cryptocurrency firms, has been licensed by the Hong Kong’s Securities Financial Commission (SFC) and will begin operations in December. This InVault Hong Kong launch demonstrates the startup’s commitment to regulatory compliance.

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