South Korean government moves against ICO fund raisers

On Friday the government of South Korea followed the example set by China and advised that it intends to ban the raising of capital through any form of virtual currency Initial Coin Offering (ICO).

The Financial Services Commission said all kinds of initial coin offerings (ICO) will be banned as trading of virtual currencies needs to be tightly controlled and monitored.

“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 regulator said in a statement after a meeting with the finance ministry, the Bank of Korea and the National Tax Service.

“Stern penalties” will be imposed on financial institutions and any parties involved in the issuing of ICOs, the statement added, without giving details.

South Korea’s decision follows warnings regarding the volatile and unregulated nature of ICOs issued recently by the UK Financial Conduct Authority and the US Securities and Exchange Commission.

The South Korean advisory noted that the cyber currency and ICO sector is being monitored in order to assess whether more relevant regulatory measures are needed.

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