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Bitcoin, other leading cryptocurrencies tumble after China bans ICOs

ForexSep 04, 2017 06:01AM ET
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© Reuters. Cryptocurrencies sink after China bans ICOs

Investing.com - Bitcoin and the other leading cryptocurrencies all sold off sharply on Monday, after China banned individuals and organizations from raising funds through initial coin offerings, saying the practice constituted illegal fundraising.

The People’s Bank of China said in a statement earlier that it had completed investigations into ICOs, and will strictly punish offerings in the future while penalizing legal violations in ones already completed.

Individuals and organizations that have completed ICO fundraisings should make arrangements to return funds, the PBOC said, issuing the strongest regulatory challenge so far to the burgeoning market for digital token sales.

It also said digital token financing and trading platforms are prohibited from doing conversions of coins with fiat currencies.

The popularity of coin offerings has surged in China this year. ICOs have become a bonanza for digital currency entrepreneurs, allowing them to raise large sums quickly by creating and selling digital "tokens" with little or no regulatory oversight.

Bitcoin dropped to $4,345.70 by 6:00AM ET (1000GMT), down $249.30, or around 5.5%, after hitting a low of $4,253.00. The digital currency rallied to an all-time high of $4,911.80 over the weekend.

Ethereum, Bitcoin's closest rival in terms of market cap, sank 11%, or $38.52, to $312.69. It briefly rose to a record peak of $394.78 on Saturday.

Other prominent cryptocurrencies such as Litecoin, Ripple and Dash also traded sharply lower.

The total value of all publicly traded cryptocurrencies was $150 billion, a figure that was down more than 16% from a high of nearly $180 billion reached on Saturday night.

To stay on top of the latest moves in the crypto-space, be sure to check out: https://www.investing.com/crypto/

Bitcoin, other leading cryptocurrencies tumble after China bans ICOs
 

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Comments (6)
Daniel Bakondi
Daniel Bakondi Sep 05, 2017 4:54AM ET
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While the news sounds tragic, the drops are not significant long term considering how crypto-currencies including Bitcoin, Ethereum, and others are growing.  It is unclear whether this will be in China's long term benefit, but it is a significant hurdle for many in China who invest in this emerging market.  For more info:. Etherem Bitcoin Cryptocurrency Attorney China Digital Currency
Rich Blumenfeld
Rich Blumenfeld Sep 04, 2017 12:26PM ET
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Calls for 950 to 198 on Bitcoin
Michel Simard
Michel Simard Sep 04, 2017 9:50AM ET
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If was so predictable, and it's the beginning. The dollar vigilante and cie thought they can outsmart the gouverments. Like it or not 'they' have the upper hands. Chinesse was behind the big raise of Bitcoin. There is other country like Viet Nam that enter the game,, let see..
Joe Bucks
ToTheMoon Sep 04, 2017 9:30AM ET
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$10000 or $1000 - what will come first?
Jesse Cohen
Jesse Cohen Sep 04, 2017 9:13AM ET
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Next step for governments and central bank will be to tax and regulate the cryptos. What will happen when the anonymity of the whole thing goes away?
Miljan Markovic
Miljan Markovic Sep 04, 2017 9:13AM ET
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Wont happen ;)
Yanko El Toro
Yanko El Toro Sep 04, 2017 8:43AM ET
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This is what happens when banks and governments start feeling like they're losing control over people's money. Are ICOs just the first target they've marked? Time will tell...
Jiang Botao
Jiang Botao Sep 04, 2017 8:43AM ET
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It makes a lot of sense for government to regulate something that could be used for scams or investing schemes, because if it goes broke then people will lose confidence on even the legitimate funds
Yanko El Toro
Yanko El Toro Sep 04, 2017 8:43AM ET
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Jiang Botao  , I agree - most ICOs are scam, and the regulators should protect investors, but I'm sure the concern is not only for the investors...
 
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