China central bank adviser bats for regulation of digital coin offerings

Stacks of Bitcoins stand in this arranged photograph in Danbury, U.K., on Thursday, Dec. 10, 2015. Photo: Ratcliffe/Bloomberg

It is the interest of the long-term development of blockchain technologies for the rapidly growing market for fundraising through the issue of digital currencies to be regulated, an adviser to China’s central bank said on Tuesday.

Sheng Songcheng, adviser to the People’s Bank of China (PBOC), said regulation was needed for a healthy market.

Sheng’s comments, in an interview with financial magazine Yicai, came a day after China banned and deemed illegal the practice of raising funds through the so-called initial coin offerings (ICOs).

Under such offerings a digital currency based on blockchain technology is sold publicly and often traded on secondary exchanges.

The value for the holder lies not in the product for which funds are being raised, but in the potential for the currency’s worth to rise.

“A large number of individual investors, including ‘da ma’ (middle-aged, retired women) entering the market was a signal that ICOs have entered the regulation phase,” said Sheng. “This rectification is mainly to warn of risks and protect investors’ rights.”

But Sheng said that blockchain technology should be supported and that China could be a global leader in the adoption of the technology.

Sheng also suggested coin issuances could still take place in China following the current market reset, once new rules were in place, according to Yicai.

Sheng has said previously that virtual currencies like bitcoin are assets but bitcoin in itself does not have the fundamental attributes needed to be a currency that could meet modern economic development needs.

Also read:

China’s regulators preparing new rules for digital coin offerings

Reuters

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

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Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.