The news (extracted from Reuters):
- South Korea’s Financial Services Commission announced today it will ban raising money through all forms of cryptocurrencies – what’s known as ICO or initial coin offering.
- The commission will hit any firm or party involved in issuing of ICOs with “stern penalties,” although details are not available.
- The regulator arrived at this decision after meeting with the finance ministry, the Bank of Korea, and the National Tax Service.
Why it matters:
- South Korea is the second country to outright ban ICOs after China, which cracked down on token sales earlier this month.
- ICOs are proving very profitable for companies, with nearly US$2 billion raised through token sales in 2017 so far.
- Regulators worldwide are still unsure how to deal with token sales. Singapore’s MAS is currently considering the issue, while the SEC in the US is putting together a “cyber unit” that will look into suspicious token sales, among other matters.
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