The Chinese ICO party just started and its already over; Bitcoin is down, Ethereum's plan B is over and NEO is furious.

For outsiders it may look like judgement day for the ICO industry as the Chinese government puts a heavy foot down on the ICO industry.

For insiders what does it all mean? In this report @BlockRush will explore the potential consequences of this development. Enjoy.

What happened?

The Chinese government woke up in a bad mood only to hear that some rebellious anarchists and fraudsters were raising funds and engaging in illegal financial activity under the name of ICO(Initial Coin Offering).

The government did not think twice; they just banned ICOs in the country and have asked all ICO campaigns to return funds to their participants.

According to the Beijing Internet Finance Association, in the last few month, there has been over 60 ICOs in the country which has seen over $300m raised from over a hundred thousand participants.

Why did it happen?

Well it was going to happen away. With Blockchain inspired ICOs making waves around the world, it is impossible that governments would not take notice of the industry.

The US, Canadian, British and Russian governments have all made their stance on the ICO industry and now it was about time the Chinese government also had their say.

However unlike their Western counterparts who did not clamp down on Blockchain technology, the Chinese government has decided to put a halt to the industry.

However we cannot fault the Chinese government entirely over these developments, as they have raised some legitimate concerns;

• according to their stats, less than 10% of all ICOs in their country were actually raised for real purposes
• corrupt officials and criminals use cryptotokens to transfer their wealth outside the nation

What did they expert from the Chinese government? A cup of coffee? Perhaps. But it turns out that the Chinese government had something else in mind; a big blow to end the party.

What does this mean?

Well it depends on who you are referring to. Consider;

Blockchain Industry: Contrary to the frenzy, the Chinese government is NOT banning Blockchain technology. They are only putting a stop to ICO issuance in the country. This mean Bitcoin and other Blockchain inspired industry can perfectly still run.

ICO Industry: This is where the problem is. There will be no further activity in the ICO industry.

Bitcoin industry: Bitcoin is not directly included in this ban hence the Bitcoin industry is not affected.

What will be the consequences?

There is not telling of the consequences of this ruling but time will tell it all.

One ironic thing about Blockchain technology is that it was designed to be "uncensorable". For this reason technically it should be impossible for any government or entity to ban any product built on Blockchain technology.

If you ask me, I think it is time to see if the Blockchain community can live upto its potential of being autonomous.

Who will be the biggest losers?

Literally, we are all losers however to be precise, here are the direct losers;

• The Chinese economy: The would loss the potential influx of foreign investment that ICO could have brought into their country
• The Chinese government: Playing friends with the Blockchain community to "legalize" ICOs would have given the government more power to regulate their activities
• Ethereum: Yes, Ethereum has long been eyeing China as a potential hotspot and now their dreams have been smacked
• NEO: NEO(formerly AntShares) hoped to become the Ethereum of China and now that dream is shattered in the face of the new regulations.
• Bitcoin: Despite the fact that Bitcoin was not included in the ban, the ban on other cryptocurrencies might cause investors to be wary of Bitcoin as they fear Bitcoin could be the next target.
• New cryptocurrencies and innovations: any bright ideals and innovations from the Chinese community would be squashed due to the 

How could this be resolved?

There are three potential possibilies:

• The government and Blockchain community reaches a compromises - very likely
• Blockchain community defiles the govern and goes anonymous - very unlikely
• Blockchain goes underground and continue operations - a weird possibility

Oh, and 2 special things I noticed

I used the inbuilt Chrome page translator to translate the official publication and so cannot be sure of the actually rendition but see this:

... to investors to raise Bitcoin, currency and other so-called "virtual currency" is essentially a non-approved illegal open financing behavior....

Did you notice them too?

1. Bitcoin is capitalized! This certainly means recognition of Bitcoin by the Chinese government and is something that even Motherboard has been campaigning for. The next time your write "Bitcoin", you might want to show some respect by capitalizing it.
2. Bitcoin was mentioned before "currency" which is of course the Chinese national currency. Well Bitcoin must have some value to the Chinese government and economy then.

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