South Korea Bans all Initial Coin Offerings. Initial coin offerings have become a very popular method of raising funds for the development of business and other purposes. However, some countries have been very worried about the new method what makes them decide to tackle that issue. The clear example here is China where all types of initial coin offerings were banned in order to protect the investors and their funds. Besides there are several other countries that have only announced new regulations but are still waiting to see all relevant analysis.
A few days ago it was revealed that South Korea has imposed similar regulations as China regarding this issue. The Financial Services Commission or FSC issued an official statement announcing that they will be banning all types of initial coin offerings. They have also added that they will not be paying attention to what technology the ICO is using or what the name of that ICO is.
The FSC has said that the risk caused by these initial coin offerings are carrying is getting bigger and bigger and that this agency has been recording increasing number of scam and fraud cases that involved initial coin offerings. Besides banning ICO, the FSC will also be dealing with the illegal digital currency trading. They have announced that they will be increasing their control of the digital currencies exchanges as there have been growing numbers of exchanges that do not follow the law.
As we have mentioned before, the campaign to ban ICO has been going on for several weeks now. Several other countries have also announced that they will be doing the same thing. Australia, for example, has issued guidelines for all investors and businesses who get involved in the initial coin offerings. Besides Australia, the United States financial regulatory agency has also announced warnings concerning ICO but they still have not decided to shut down all initial coin offerings.
Just as it was the case back when China announced the ban of ICO, the value of Bitcoin and other digital currencies dropped significantly. Just minutes after the FSC announced the ban of ICO, the value of Bitcoin dropped 2 percent. However, the value of Bitcoin was not the one that dropped the most as Ethereum was recording the drop of 4 percent.
Last week, it became clear that China lost the title of the third biggest market for Bitcoin market. The country that took the third position from China was South Korea and now, it seems that South Korea might be losing that title as well. The main reason for that is the fact that ICO will be impacting the entire trading market of digital currencies in South Korea.
South Korea plays significant role in the Bitcoin market but also in the Ethereum market as well. In the 24 hours before the FSC announced their ban, South Korea accounted for 30 percent of the entire global ether trading market and because of that, this ban might have huge consequences.
Written by Vedran Ostojic
Ohhhh this is completely new