According to reports initially published by the Xinhua News Agency, a Chinese state-owned media house, police have cracked down on 107 altcoin operations in the country during the past year alone.
These include scams and non-existent assets such as Five Elements Coin, Asia-Euro Coin, OneCoin, and Ticcoin. Authorities have described at least some of the coins as Ponzi schemes.
By the end of October 2017, many Chinese cryptocurrency exchanges had shut down following orders from regulators directing several prominent exchanges to cease operations before the month was through. On September 8, the People's Bank of China effectively banned the practice of holding token offerings (also known as initial coin offerings, or ICOs) within the nation's borders.
Zhao Shouguo, a professor of economics at Xi'an's Northwest University, suggested that the ban may have actually created an opportunity for fraudsters. In his words:
"The ban on ICOs and closure of exchanges for mainstream virtual currencies created a market vacuum and gave rise to various knock-off cryptocurrencies. Scheme suspects would tell investors that mainstream cryptocurrencies are losing traction because of the ban and it's their time to shine."
The crackdown on some of the 107 cryptocurrencies occurred before the ban and closures went into effect.