China: Financial supervision warns against security token offerings

When China issued an ICO ban towards the end of last year, the big waves hit Bitcoin Space. Immediately reacted the Bitcoin course with a significant kink. As a result, many Chinese blockchain companies also emigrated – targets were Japan or Hong Kong Special Administrative Region. Financial supervisors have now also commented on security token offerings – however, there have been no major reactions so far.

Security Token Offerings are currently on the rise – so it is at least on the part of many investors. The idea behind it sounds promising: investors acquire company shares with the security tokens. This should ultimately provide more collateral than is the case with ICOs. The Initial Coin Offerings do not have the best reputation in the Bitcoin community, as they often only serve to quickly generate capital without real service.

Nonetheless, Huo Xuewen issued a warning to investors from the Chinese Financial Market Authority. According to this, interested parties should only invest as soon as STOs are legal – but this is currently not the case:

“I hereby warn all those who publish and promote STOs in Beijing. My advice is to only invest in such projects if the government has declared them legal. “

After all, it is in the interests of financial supervision to retain control of people’s wealth management:

“We need to manage the wealth of high-end customers, wealthy individuals, and people’s wealth – that’s the responsibility of all asset managers in Beijing. From this perspective, we need a diversified asset management organization that requires over $ 30 million of wealthy client money management and the wealth of ordinary people, “

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