Huo Xuewen, chief of Beijing’s Municipal Bureau of Finance, says there is risk in holding security token offerings (STOs).
Recently, at a wealth management forum hosted by the Bureau, Huo claimed that STO fund-raising activities are “illegal,” at least in Beijing.
“I will issue a risk warning to those who promote and issue STO tokens in Beijing. My advice is to only engage in such offerings when the government has legalized them,” he said.
STO, which stands for Security Token Offering, refers to a movement taking place at the Initial Coin Offering (ICO) stage. PolyMatch introduced the concept, which features a new business model that mitigates risks for investors.
In the summer, Pan Gongsheng, a vice president at the PBoC, claimed that the central bank would hit back hard against the ICO projects which had moved overseas yet continue to target investors on the Chinese mainland.
His statement was: “Any new financial product or phenomenon that is not authorized under the existing legal framework, we will crush them as soon as they dare to surface.”
Also, in August, the finance department of China’s Guangzhou Development District issued a notice to local businesses, banning them from hosting any crypto-related promotions or events.