The Xinhua News Agency reported today that over 90 percent of token offerings (ICOs) based in China have fully compensated everyone who purchased their tokens, indicating that the process of shutting down all Chinese-hosted cryptocurrency exchanges and ICOs is well underway. Additionally, several exchanges have begun compensating holders of their native tokens, which users of a given exchange could purchase with fiat currency and then trade for cryptocurrency. Xinhua attributed the information to a government office that’s name translates to “the Shanghai Internet Financial Risk Special Rectification Work Leading Group.”
Of the 17 exchanges that had been operating in China, four have already ceased operations, while the rest have announced the dates that they intend to halt trading on their platforms.
On September 4, the People’s Bank of China (PBoC) and several other government agencies jointly announced an ICO ban, effective immediately from the date of issuance. As reported by ETHNews, the Hong Kong Securities and Futures Commission (SFC) released a statement the following day that advised, “Where the digital tokens involved in an ICO fall under the definition of ‘securities,’ dealing in or advising on the digital tokens, or managing or marketing a fund investing in such digital tokens, may constitute a ‘regulated activity.’” The announcement went on to explain that those wishing to engage in such activity would have to first obtain the requisite license from the SFC.
On September 15, government officials informed two prominent Chinese exchanges, Huobi and OKCoin, that they would have to stop trading by October 31, 2017.
Furthermore, from February 2017 until the beginning of June, Chinese exchanges complied with a PBoC directive to implement a freeze on all cryptocurrency withdrawals.