First China, now South Korea has banned ICOs

EnlargeMario Sánchez Prada

"Raising funds through ICOs seem to be on the rise globally, and our assessment is that ICOs are increasing in South Korea as well", the Financial Services Commission said in a statement, according to Reuters.

China has followed the ICO ban with a country-wide ban of cryptocurrency exchanges; it's unclear whether South Korea plans to do anything similar.

China also banned ICOs earlier this month, a move that came with shutdowns of several cryptocurrency exchanges.

"The guidance ASIC has released is a positive step to ensure a viable future for ICOs in Australia, and sits alongside other positive initiatives such as removing double taxation on digital currencies and driving worldwide blockchain standards". He advised industry players that "If it is a normal company with technology, it can raise money through transparent methods such as stock openings and crowdfunding".

The announcement triggered a sell-off in crypto markets.

For now (as time of the press) Bitcoin price has decreased around 2.84 percent in the last 24-hours (on Friday Sep 29), which is following after hitting the nearly monthly highest and retesting supports around $4,000. Ethereum and bitcoin are often used to buy into ICOs.

The ICO or a token crowdsale is a way of raising funds by selling digital tokens, typically based on the Ethereum platform.

FINMA announced on Friday that it was looking into a number of ICOs for breaching "provisions on combating money laundering and terrorist financing" and other regulations. CBOE last month said it planned to roll out its own Bitcoin futures in the coming months.

Its national police agency said this week it confirmed North Korean hackers tried unsuccessfully to hack four bitcoin exchanges using emails containing malicious codes between July and August.

"It would shock me if you don't see pump-and-dump schemes in the initial coin offering space", US Securities and Exchange Commission chairman Jay Clayton said on Thursday in Washington. Following China's lead, South Korean authorities have also shown their teeth, warning of harsh penalties for venues who do not honor the ban.

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