As China continues to follow the path of restrictive and ambiguous management of the growing fintech industry, technology companies depart for 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 that runs the ICO, and to thank them for that is China. The fear of potential financial crimes the government of China identified an initial range of coins as a tool of illegal Fund-raising. Blockchain startups of the country began to seek homes where they can freely grow and develop.
ICO is the most popular method of attracting investors, which is used by developers. The sale of digital tokens occurs for Fiat or for another more well-known cryptocurrency, such as Bitcoin, which the buyer can exchange for goods and services since the release of either 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 the collection of funds through ICO, Singapore and Hong Kong have filled the gap.Financial centers are created as convenient as possible for the ICO start-up conditions of registration.
“We cannot say that Singapore has become a center for ICO, since it is necessary to spend more work, but Yes, since September last year, the country has been active in the ICO sphere”, — said the head of the Association of Cryptocurrency Enterprises and Startups Singapore Anson Sill.
Singapore has become the third most popular place to launch ICO after the United States and Switzerland.
For Chinese companies seeking a safe haven, Singapore and Hong Kong are the obvious choice to enter the crypto market friendly Japan or even Taiwan.
Ben Yates, a Hong Kong lawyer who specializes in fintech and cyber law, commented on the increasing demands ICO:
“It is highly likely that a surge of requests for ICO that we have received over the past few months, at least partly as a result of restrictions in mainland China”
Not only Chinese companies seek refuge from the 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 has developed specific rules regulating the ICO, although in both States establishes the regulatory framework concerning the collection of funds using digital currency.