South Korea’s Financial Services Commission (FSC) has announced that the ban on domestic initial coin offerings will not be lifted.
The country’s financial regulator, the Financial Services Commission (FSC) has recently found some projects which broke the ban by establishing paper companies in Singapore and raising funds from Korean investors and concluded the offerings are highly risky for investors.
The FSC decision was informed by the results of a survey conducted by the Financial Supervisory Service (FSS), indicating that some ICOs purportedly conducted abroad had also illegally raised money from Korean investors.
The FSS has reportedly sent a questionnaire to 22 cryptocurrency-related firms that conducted ICOs in foreign countries and got replies from 13. These held their token sales in the second half of 2017 and raises a total of $509 million.
The survey reportedly found that some projects set up companies in Singapore to circumvent the ICO ban and raise funds from South Korean investors. The findings were corroborated by marketing materials such as white papers, written in Korean.
Hong Nam-ki, head of the office for government policy coordination, said in October that regulators in the country have been reviewing the topic in recent months and that the FSC survey would guide decision-making for the policy.