The People’s Bank of China recently announced its decision to introduce a complete ban on ICOs, a stunning move that sent shockwaves throughout the world. The global blockchain is abuzz, parsing this decision and its potential consequences.
Many believe it will impede innovation, making access to funds to launch new ideas to life difficult. Others expect that many Chinese businesses will relocate to other markets. But everyone agrees on one thing: the implications will be vast.
“China just joined the list of countries which made their official statements about ICOs, reminding everyone that tokens could be securities and, as such, their sale through an ICO is illegal if it does not follow the law of the land,” says Katrina Arden, an attorney with numerous US-based ICOs under her belt and currently a legal counsel at ICOBox, a premier provider of SaaS ICO solutions.
Katrina continues: “Unfortunately, there have been a lot of ICOs recently that were conducted in violation of the securities law of many countries. It is a very important and positive development that governments of countries such as U.S., Singapore, and China are letting the ICO market players know the rules of the game, and what regulations they need to obey. But not all ICOs are illegal. Tokens could still be sold to public as long as their sale complies with the relevant laws.”
The blanket Chinese ban is in stark contrast to the approach of such countries as Switzerland and Singapore, which have created favourable environments for new financial technologies and cryptocurrencies.
Russia is presently contemplating allowing digital currencies to trade on the Moscow exchange. The US and UK are taking a more guarded “wait and see” approach, stepping in to protect the investors as needed but otherwise allowing startups to play in the sandbox and test new financial tools.
Each market has its own priorities and legal frameworks which determine their approach to the industry’s legal regulation. But all of them have one thing in common: In different measures they all protect investors from being taken advantage of.
More at: ‘Chinese ICO Ban Is Not Quite What It Appears,’ US Blockchain Attorney Explains – CoinSpeaker