It’s illegal in China

The burgeoning market for digital token sales has faced the strongest regulatory challenge so far, as China’s central bank banned initial coin offerings and asked all related fundraising activity to be halted immediately.

hong kong — China’s central bank said initial coin offerings are illegal and asked all related fundraising activity to be halted immediately, issuing the strongest regulatory challenge so far to the burgeoning market for digital token sales.

China, due to its size and as one of the most speculative IPO markets, needed to take a firmer action Jehan Chu, managing partner at Kenetic Capital Ltd

The People’s Bank of China said on its website on Monday that it had completed investigations into ICOs, and will strictly punish offerings in the future while penalising legal violations in ones already completed. The regulator said that those who have already raised money must provide refunds, though it didn’t specify how the money would be paid back to investors.

It also said digital token financing and trading platforms are prohibited from doing conversions of coins with fiat currencies. Digital tokens can’t be used as currency on the market and banks are forbidden from offering services to initial coin offerings.

“China, due to its size and as one of the most speculative IPO markets, needed to take a firmer action,” said Jehan Chu, managing partner at Kenetic Capital Ltd in Hong Kong, which invests in and advises on token sales. — Bloomberg