Hi everyone. This article will explain news from China officially outlawing ICOs as a type of illegal fundraising, and end with a Market Update on the Crypto Market, featuring cryptocurrencies Bitcoin, Ethereum, Steem, and EOS.
Statement from Chinese Government
The official statement is available here on the Chinese government website (in Chinese). CoinDesk's translation of this statement is:
ICO financing refers to the activity of an entity raising virtual currencies, such as bitcoin or ethereum, through illegally selling and distributing tokens. In essence, it is a kind of non-approved illegal open fund raising behavior, suspected of illegal sale tokens, illegal securities issuance and illegal fund-raising, financial fraud, pyramid schemes and other criminal activities.
The second article clarifies, and adds that all ICOs should cease immediately. It also requires ICOs to cease their ICO and refund all investors. The third article adds even worse regulation on cryptocurrency, shown below:
As of the date of this announcement, trading platforms shall not conduct any exchange business between fiat money and virtual currencies, shall not provide information and price for virtual currency trading.
The statement is backed by (at least) 7 financial authorities and regulators in China, including the People's Bank of China, the Central Network Office, the Ministry of Industry and Information Technology, the China Banking Regulatory Commission, and the State Administration for Industry and Commerce. Given this news, ICOs are starting to cease activities in China, including EOS and others. It's unknown if or how they will go about refunding investors, however.
Market Update
The crypto market is dwindling as many of the top cryptocurrencies are taking a hit. With all of the top ten cryptocurrencies and almost all of the top 50 declining, the market itself is currently at a cap of less than $150B. It's definitely very possible the Chinese statement impacted cryptocurrency harshly.
Here is a snapshot of the top ten cryptocurrencies:
This decline does, however, mark a great spot for buyers to get in at a "discount price." Many buyers may choose to "buy the dip" today.
Bitcoin
Bitcoin is currently trading at above $4300, which is much lower than its all-time high of ~$5000 last week. The BTC market cap is at about $71.7B as of now.
Ethereum
Ethereum also took quite a hit, currently trading at less than $300, a sharp decline from the $350 it was trading at just hours ago.
Steem
Steem is also declining (currently at ~$1.12), but for most members of the Steemit community intending to hold, this shouldn't matter too much. In fact, this presents a ripe opportunity for Steemians to buy Steem for lower prices.
EOS
EOS is currently trading at less than a dollar, which is about 30¢ less than the $1.30 it was trading at hours ago.
This fall presents an opportunity to many buyers who haven't gotten in yet to get many coins at much lower prices. (as long as you aren't in China!)
sources: The first cover image is from CNN Money. All other images are from CoinRanking.