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ICOs have been declared illegal in China, causing the cryptocurrency markets to tumble, while an upcoming Dash conference in China has been postponed.
Initial coin offerings as a means of raising capital for cryptocurrency projects have risen to high levels of popularity, with the sale of tokens, many of them issued on the Ethereum blockchain, used to crowdfund development. A notice released by the People’s Bank of China bans the issuance of ICOs, and demands that their issuers refund their customers.
Bitmain co-founder Jihan Wu mentioned the news via Twitter, but also reiterated that the ban only affected ICOs, and that cryptocurrencies like Bitcoin remain perfectly legal for the time being.
Bitcoin is still legal in China. But ICO is illegal now.
— Jihan Wu (@JihanWu) September 4, 2017
Despite this important clarification, market uncertainty nonetheless has sent ripples through the field.
Upcoming Dash conference in China cancelled
Possibly as an indirect result of the ICO ban, an upcoming conference in China where Dash was scheduled to have a presence has been postponed. The conference was slated to take place in Beijing on the 9th of September, and was one of three treasury-funded conference appearances scheduled for this month, the others to take place in Stockholm, Sweden on the 7th of September, and the main Dash conference in London on the 24th. An announcement to conference attendees stated that the conference would have to be rescheduled for a different time and date as well as location, and offered a refund to ticket holders.
Markets took a $35 billion drop
Though the announcement out of China only directly affected one sector of the market in one area of the world, its ripples were nonetheless felt through the rest of field. In addition to the impact felt by the ICO tokens and general market uncertainty, the price of Ethereum crashed over the weekend, dropping from about $390 on Friday to $286 at present, losing nearly $10 billion in market cap. This caused a domino effect to tumble into Bitcoin as Ethereum holders sought to flee the market, resulting in a price drop from nearly $5,000 to $4,211 at present, which affected other coins as well. Dash fell from $395 on Saturday to $308 at present. All in all, cryptocurrency fell by around $35 billion over the weekend, from an all-time high of $179 billion down to $144 billion at present.