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Author Topic: [2017-09-05]China's ICO Ban: A Full Translation of Regulator Remarks  (Read 2564 times)
Siren
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September 05, 2017, 09:10:01 PM
 #1

China's ICO Ban: A Full Translation of Regulator Remarks


Recently, a number of token fundraising activities in the country, including initial coin offerings, have emerged for the purposes of financing and speculation. Such [sales] are considered illegal and disruptive to economic and financial stability.

In order to be compliant with the messages conveyed during the National Financial Work Conference, to protect the legal rights of investors and to prevent financial risks, we have the following announcement.

The statement is based on the law of the People's Republic of China, as well as the laws of the People's Bank of China, commercial banking and securities law, cybersecurity and telecommunications law, and financing and financial activities law.

1. An accurate acknowledgement of the nature of ICOs

"Token fundraising" refers to a process where fundraisers distribute digital tokens to investors who make financial contributions in the form of cryptocurrencies such as bitcoin and ether.

By nature, it is an unauthorized and illegal public financing activity, which involves financial crimes such as the illegal distribution of financial tokens, the illegal issuance of securities and illegal fundraising, financial fraud and pyramid scheme.

Relevant authorities will closely monitor the latest market status and collaborate with the justice department and local governments.

Altogether, they will strictly enforce the current legal framework to solve the market chaos. Any criminal suspicion will be handed over to the justice department.

The tokens or "cryptocurrencies" that are distributed during the token fundraising are not issued by the monetary authority, which has no legal property as fiat currency does and cannot circulate in the monetary market.

Any organization or individual is prohibited from starting illegal token fundraising activity

Starting from the date of this announcement, all kinds of fundraising activities through token issuance should stop immediately.

Organizations and individuals who have completed token fundraising previously shall make arrangements such as refunding crypto assets to investors to protect investor rights, and to deal with the risks properly.

Relevant law enforcements will investigate and severely punish those who refuse to halt fundraising activities through token issuance and those whose completed token fundraising activates are found to have violated the law or regulation.

Reinforce the supervision on platforms that provide exchange services for tokens issued during the fund raising

Starting from the date of this announcement, any so-called token exchange platform shall not:

Be involved in offering exchange services between fiat currency and tokens
Buy or sell tokens for cryptocurrencies, or act as a central party facilitating the trading of tokens for cryptocurrencies
Provide price bidding or middleman service for the exchange of tokens for cryptocurrency.
For any token exchange platform that violates the law or regulation, financial authorities will request:

The telecommunication department to shut down its website and mobile application.
The Cyberspace Administration of China to delist its mobile application from app stores.
The State Administration for Industry and Commerce to discard its business license.
No financial institutions or non-banking payment institutions shall operate businesses that deal with token fundraising

All financial institutions and non-banking payment institutions shall not directly or indirectly provide account opening, registration, trading, clearing and settlement services for token fundraising activities; shall not underwrite any insurance policy that relates to tokens and cryptocurrency, or include any token and cryptocurrency under the insurance policy coverage.

Should any financial institution and non-banking payment institution be found in violation of the law or regulation, they should be reported to relevant authorities immediately. The public should be highly vigilant about potential risks that come with token fundraising and trading.

Token fund raising and trading pose multiple risks, including fraudulent assets, business operational failure, and speculation, etc. Investors are responsible for taking such risks themselves and thus are advised to remain cautious on suspicious projects.

For any illegal financing activity that operates under the name of "coin," the public should become better at spotting scams and always stay vigilant against risks, and should report to the authority any lead of law and regulation violation.

Industry Organizations Should be Self-disciplined.

Different financial industry organizations should study the regulation well and have member companies to voluntarily fight against any illegal financial activity that relates to token and cryptocurrency fund raising; should stay away from this market chaos; should improve the education for investors; and jointly maintain the financial stability.

https://www.coindesk.com/chinas-ico-ban-a-full-translation-of-regulator-remarks/


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September 06, 2017, 04:33:43 AM
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Nice ban, stop the wild west in China where big cheaters collect money big time there.

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September 06, 2017, 04:46:56 AM
 #3

Thanks for the post. What happens to those which have completed their ICO/fundraising rounds?
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September 06, 2017, 06:35:36 AM
 #4

Nice ban, stop the wild west in China where big cheaters collect money big time there.

It's a first step, but the real effect will start to kick in if the entire Asian continent is teaming up to wipe out this entire ICO craze. If certain ICO's start raising plenty of millions in funds in just a matter of hours, and we're talking about empty ICO projects here, then something is horribly wrong with the people in this market. I personally haven't had a single moment where I thought I would be investing in one of the plenty ICO's that this market counts, because I know how rotten this market is, and I don't want to fill the pockets of a few greedy entities looking to get rich instantly. ICO's if done properly, and by legit minded projects only, with a problem solving idea behind them, are a great way to generate the necessary funds to move forward, but the scammers of this world have totally ruined this market.

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