It will take something more than a state ban on the activities of the ICO to deter issuers in China.
Both investors and issuers in the country have found a way to circumvent the laws that were implemented last year by Chinese regulators, according to a report in the local Caixin Global publication.
Despite the fact that the demand for ICO is largely due to Asia, China in September 2017 shamefully dealt with the market, making it illegal to sell tokens and inspiring South Korea to follow suit. Meanwhile, in Asia there is a large part of Bitcoin mining, and investors have often sought to reinvest their profits into the initial offering of coins.
Despite the ban, investors continue to access recently released tokens, which can be very speculative, while issuers revolve around the ban on placing their projects abroad. A workaround for issuers was the offer of free digital tokens.
Opportunities to bypass the ICO ban
The effectiveness of the ICO ban in China is questionable. The trading volume may have fallen slightly, but activity is still taking place in veiled attempts, such as airdrop, IMO and others.
Companies were able to circumvent the ban on the initial offering of coins by organizing airdrop crypto-currencies, in which tokens are distributed at zero cost. Meanwhile, issuers behind tokens benefit from the provision of such events, as projects are gaining momentum among members of the community.
Initial proposals for mining, or IMO, are another workaround. These deals allegedly give investors the opportunity to support the development of new coins, but the self-regulatory agency in China warned that they almost did not differ from the ICO.
Will China weaken its grip on the crypto currency market, including ICO, is yet to be seen. But so far, it seems, the market is alive and well in the country.
Author: Olga Novikova, Analyst Freedman Club Crypto News
Image from Fotolia
Source: Read Full Article
Binance’s Swipe-Powered Crypto Debit Card Debuts in Europe
Zcash Reward-Distribution Vote Questioned as Only a Small Sample Took Part
AirSwap Offers Up to $20,000 For Its Bug Bounty
Ebang planning to expand business to mine LTC and DOGE
Ex-CFTC Chairman to Promote Blockchain-Based USD in New Think Tank