South Korea’s Financial Services Commission (FSC) has announced the ban on domestic initial coin offerings will not be lifted, CoinDesk reports. Regulators have found that some of the South Korean projects have been exploiting the ICO ban loophole by establishing paper companies in Singapore and raising funds from Korean investors.
Back in September, the Financial Supervisory Service had researched 22 local companies involved in international ICO business, 13 of which responded to the survey. The researchers have concluded that the activities posed a high risk for investors—some projects were found not to disclose crucial information, and the tokens’ value had decreased by nearly 68 per cent on average since launch. After reviewing the findings, the FSC urged the public to err on the side of caution when investing in similar projects and decided that the country would maintain the ICO ban.