China and South Korea move to ban cryptocurrency ICOs
ASIA – (FinancialPress) — Some of the biggest names in cryptocurrency are taking heavy body shots this morning, after Monday’s news from Asia that ICOs (Initial Coin Offerings) are now outlawed.
Used by startups to avoid going through extended bureaucratic processes required by banks and venture capitalists, ICOs were block-banned by Chinese regulators on Monday, with South Korea following suit shortly thereafter—going as far as promising heavier punishment for those looking to fund their ventures through the method.
While Tuesday morning’s losses may seem minimal, ethereum lost as much as 20% compared to last week’s valuation—mainly due to it being the most popular ICO platform thanks to its “smart contract” capability, allowing for automatic payback to investors after the startups reach a certain amount of ether, or currency.
eToro‘s operations officer for Chinese businesses, Adam Efrina, stated that this is “a bigger deal than most people think.“
Efrina sees this as an effort from the Chinese government to take down scammers, and further notes that the new regulation completely forbids individuals from incurring in crypto transactions.
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