Hong Kong and Singapore welcome Chinese and South Korean ICO
As China continues to follow the path of restrictive and ambiguous regulation of the growing fintech industry, technology companies are heading towards the more hospitable shores of Hong Kong and Singapore.
In the past few months, Singapore and Hong Kong are experiencing a boom from the influx of companies launching ICO, and thank them for it is China. In fear of potential financial crime, the Chinese government identified the initial supply of coins as a tool for illegal fundraising. Blockchain startups of the country began to look for a haven where they can freely grow and develop.
ICO is the most popular way to attract investors, which developers use. The sale of digital tokens takes place for Fiat or for another more well-known cryptocurrency, for example, Bitcoin, which the buyer can exchange for goods and services from the moment of release or use as an investment in a startup. This form of fundraising is under scrutiny in all countries of the world, because it still is not everywhere regulated and is considered to be open for activities related to the crime.
When China stopped raising funds through the ICO, Singapore and Hong Kong filled this gap.Financial centers are created as convenient as possible for the ICO start-up conditions of registration.
“We can not say that Singapore has already become an ICO center, because it is necessary to carry out more work, but Yes, since September last year, the country has been active in the field of ICO”, — said the head of the Association Cryptocurrency Enterprises and Startups Singapore Anson Zill.
Singapore became the third most popular place to launch ICO after the United States and Switzerland.
For Chinese companies seeking safe haven, Singapore and Hong Kong are the obvious choice for entering the crypto-friendly Japan or even Taiwan market.
Ben Yates, a Hong Kong lawyer specializing in fintech and cyber law, commented on the increase in ICO requests:
“It is very likely that the surge in the number of ICO requests we have received over the past few months is at least partly a consequence of restrictions in mainland China»
Not only are Chinese companies seeking refuge from regulators in Hong Kong and Singapore. Regulatory reforms relating to the ICO in South Korea has also forced many companies to leave Seoul. Company from Thailand may soon follow suit if the government will make tax levies for cryptocurrency startups.
To date, neither Hong Kong nor Singapore have developed specific rules for the regulation of ICO, although both States have established a regulatory framework for the collection of funds using the digital currency.