People’s Bank Of China Plans To Limit Cryptocurrency Airdrops
The People’s Bank of China (PBoC) plans to end the free distribution of cryptocurrency tokens or airdrops. CoinDesk writes with reference to the report on the financial stability of the regulatory agency for 2018.
In it, the PBoC writes that the “hidden” initial coin placements (ICO), presented as airdrops, continue to flourish, despite previous attempts to cope with China’s illegal distribution of tokens.
As one of the stages of the process, cryptocurrency firms move abroad and attract agents to invest on behalf of Chinese citizens, writes PBoC. Other projects do not sell tokens to directly collect money from the general public, but distribute them for free. Then they try to raise their price in the secondary market in order to benefit for themselves, the bank claims.
Based on the available statistics, PBoC concluded that out of 65 ICOs that were held in China before July 18, 2017, only five ended before 2017. 105,000 people took part in the ICO, providing a total of 2.6 billion yuan ($ 377.3 million), representing more than 20% of the amount collected worldwide during this period.
The Central Bank of China argues that it must remain extremely vigilant and cooperate with other departments to track activity in the cryptocurrency industry and protect investors.
The People’s Bank of China took measures to limit fundraising through the ICO in September 2017, completely banning them. In June of this year, the PBoC Vice Governor confirmed that cryptocurrency trading remains an illegal activity in China, while noting that the activity related to the ICO has gone underground.
In August, the China National Internet Currency Association (NIFA), a self-regulatory organization founded by PBoC, added “token sales” as a separate category of illegal activity that citizens can report.
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