Private equity funds found to be investing in banned digital currencies offerings, says report
Beijing Bureau of Financial Work chief quoted on Sunday as saying some PE funds had been found taking part in ICOs outside the regulatory framework, and that the regulator would seek to weed them out
Beijing’s municipal financial regulator has warned private equity (PE) funds not to continue investing in initial coin offerings (ICOs), a practice banned by the mainland’s central bank three months ago.
Huo Xuewen, chief of the Beijing Bureau of Financial Work, said in a report published on Sunday that some of the funds had been found taking part in ICOs – fund-railings by the issuers of digital currencies such as bitcoin – outside the regulatory framework and he pointed out it was a wrongdoing that the regulator would seek to weed them out.
“Long term, those practices are misleading and wrong,” he was quoted by Securities Times as saying.
He added the authorities now plan to set up a strict monitoring system to track operations and investments by PE funds.
ICOs have become not only illegal fundraising schemes, but have caused damage to China’s foreign-exchange management system
Huo did not reveal the names of the funds, nor did he mention the amounts involved.