People’s Bank of China Declares ICOs Illegal

The People’s Bank of China declared ICOs illegal.

According to the note note issued by the Chinese central bank, there are serious suspects that the recent growth both in number and volume of ICOs is seriously disrupting the economic and financial order because, brings speculation and engagement in illegal financial activities.

The fundraising activity conducted via ICO and virtual currencies essentially represents an illegal financing behavior. As of today, all types of financing activities shall cease immediately and the organizations and individuals who have completed their fundraising process should provide refunds to investors.

In addition, digital token financing and trading platforms are prohibited from converting coins to fiat currencies while banks cannot offer services to ICOs.

The People’s Bank of China note comes approximately a month later the US Securities and Exchange Commission issued a report asserting that United States securities laws apply to Initial Coin Offerings and that the digital coins sold therein may be regulated as securities and said issuers must register the deals with the government unless they have a valid reason.



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