What caused the ICO ban in China? What is the future?
Sep 18, 2017 Posted / 12536 Views
Participating and running in ICO is now banned for both Chinese companies and citizens. All the Bitcoin exchanges are also getting ready to shelve their services subsequent to instructions from the government. China's move last week to prohibit ICO has caused pandemonium in the middle of start-ups looking to raise money through the novel prompting halts, fund-raising scheme. The ban will solitarily be valid to trading of cryptocurrencies on exchanges, according to people concerned with the matter, who asked not to be named because the information is private, as per the reports.
Authorities don’t have tactics to discontinue over-the-counter transactions, those people said. China’s central bank said it couldn’t straight away comment.
Whereas bitcoin users will still be allowed to trade cryptocurrencies in China devoid of exchanges, the procedure is probable to be slower and come with more credit risk, analysts have said so.
Maybe the possible major purpose of the verdict to shut down Bitcoin trading was the Chinese government’s apprehensions that growing numbers of people were taking part in ICOs. People there are as a result quite advised regarding the technology and its applications for token generation and trading. That was fuelled by Chinese obsession and increasing prospects in the cryptocurrency market ( since the biggest Bitcoin miners are all to be found in China).
To cut a long story short, the Chinese government apparently decided to keep away from a bigger ruckus and take the ‘sustainable development’ approach to relieve people from the uncertainties about cryptocurrency instability and probable losses.
The ICO trend has gotten out of hand. Initially,in the first half of the year, ICOs raised more than $1 billion for blockchain based projects.
It doesn't take a financial expert to know that many ICOs function like classic pump and dump scams. There are too many con-men out there simply looking to make quick and easy money.
By closing down on the ICO sector, China may be avoiding bigger financial dilemmas for consumers down the line. There are securities laws for a cause.
China is a hub for cryptocurrency craze which puts the country in a predominantly unstable position if and when the crypto roar comes crashing down.
Rumors say that China is looking to imprint its own national cryptocurrency. If the country achieves something like that it will have better control over that platform than the current options.
The Chinese regulators have banned the carrying out of ICOs within its borders, while this has changed the actions of a number of blockchain companies, others have sustained with their original plans, been obstinate that such a growth is only but a impermanent hindrance that will lead to a more sterile industry.
Moreover that, Beijing still hasn’t created appropriate way out to control the mobilization of capital via ICO and how to license the exchange of cryptocurrencies. Consequently, the government simply took a break to make a regulative framework for crypto economy. Nobody knows what comes next.
Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .
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