Initial coin offerings (ICOs) used by startups to raise funds using cryptocurrencies that are traded via the internet were banned this week in China, with South Korea following suit soon, by the looks of it. The USA was the first to make this move back in July, introducing sterner measures against ICOs. This may seem like a trifle and not a big deal, but it is the cryptocurrency industry that is put under a lot of pressure because of this.
Bitcoin and Ethereum have had a significant fall since Monday, when the ICO ban news was announced, and have continued to lose their value (Monday to Tuesday loss was 2.5%). Ethereum was particularly hit hard, because it is the platform of choice for the coin offerings.
The ICO ban was deemed a “huge deal”, in the words of Adam Efrima, trading platform eToro’s operations director, who gave an interview for Business Insider, adding that, “it’s bigger than most people think it is.”
After the US issued a risk statement about ICOs this summer, China’s central bank has issued a ban on all related funding as it “disrupts economic and financial order.”
Singapore’s central bank gave a broader statement regarding the causes behind the ICO ban: “ICOs are vulnerable to money laundering and terrorist financing risks due to the anonymous nature of the transactions, and the ease with which large sums of monies may be raised in a short period of time.”
Source:
“Cryptocurrencies are continuing to fall after China’s shock ICO ban”, Williams-Grut Oscar, businessinsider.com, September 5, 2017.
Pointman
6 years ago
However much cryptocurrencies are very useful as they eliminate middlemen, they also have negative effects. Some of these include criminals using these unrestricted currencies to transfer payments. There are other disadvantages which include reduction in the taxes the government collects from conventional banks as many...
However much cryptocurrencies are very useful as they eliminate middlemen, they also have negative effects. Some of these include criminals using these unrestricted currencies to transfer payments. There are other disadvantages which include reduction in the taxes the government collects from conventional banks as many people leave for cryptocurrencies. However, these cryptocurrencies' most effectiveness includes that they also move on cellphones anytime anywhere.
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sun17
6 years ago
I hope that bitcoin and other cryptocurrencies shut down because it will be nice chance to buy and keep them for long period, But I think that these news will not affect on bitcoin and etherium. For example, between saturday and today, bitcoin has a value between 5000 and 4500 USD. So, no increase no down effect.
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zuga
6 years ago
there is definitely a crypto bubble ready to burst.. when ? thats a million dollar question .... Granted once that happens it will help weed out all the shitty criptyo-currencies. BTC will most likely survive this.
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Joe Wrinkle
6 years ago
something was bound to hit bitcoin eventually im sure it wont be long till its on the rise again though.. its all about peoples trust in the market of it. once this is in the past people will trust again
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