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Bitcoin course gives way – China bans crypto exchanges News

Monday, September 4th, 2017 | Economy

On Monday the supervisory authorities of the country banned the so-called Initial Coin Offerings (ICO), which could be used to create new cyclic currencies, similar to the initial public offering (IPO). "ICOs are a kind of illegal public funding that is associated with criminal activities such as fraud and snowballing," a statement from the Central Bank said. The courses of cybervises slipped significantly after the ban. By far the largest currency Bitcoin lost on the trading platform BitStamp seven percent to 4286 dollars.
Companies can use ICOs to generate capital. They thus create their own currency via the blockchain, which is usually acquired by the investors via Bitcoins. In this type of exchanges, investors do not receive shares, but so-called tokens, which can be traded at specific crypto exchanges. In China, ICOs are particularly popular, according to a study, this year alone, 65 such placements with a total volume of 2.62 billion yuan (converted around 330 million euros).
Experts have already expected the ban. "World-wide, regulatory authorities are having trouble understanding the ICO model and the risks behind it," said Zennon Kapron, Managing Director of Kapronasia, a finance-based financial consulting firm based in Shanghai, to find out how best to regulate it. China had now put a stop to the hype surrounding ICO in order to introduce regulatory measures in peace. "I believe this will only be a temporary ban."
(Reuters)

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