A top People's Bank of China official said security token offering businesses remain widespread, with most such financing activity possibly fraudulent, the South China Morning Post reported Dec. 9.
A security token offering, known as an STO, is a type of initial coin offering, or ICO, backed by tangibles that offer an alternative to private equity or venture capital financing.
According to Pan Gongsheng, a deputy governor of China's central bank, the majority of financing operations via STOs and other ICOs could be fraudulent. This is the first time a top PBOC official has discussed the STO ban, the report said.
Pan added that STOs and ICOs remained rampant in China, even though the central bank banned ICOs in September 2017 to rein in the cryptocurrency market and minimize systemic financial risk.
Up until the crackdown, the report said, 80% of all global virtual currency transactions and ICO financing activities were based in China.