Following banning and tight regulation in China, South Korea and elsewhere.
Hong Kong and Singapore are new kids on the blockchain in Asia.
Beijing’s crackdown on digital currencies is sending investors into the arms of the perennial competitors.
The two nations have become the up-and-coming destination for companies that want to raise funds using blockchain technology, as Beijing’s recent crackdown on digital currencies sends investors to speculate elsewhere.
In recent months, number of companies launching initial coin offerings (ICO) in Singapore and Hong Kong has rocketed, according to fintech businesses, lawyers and industry groups.
“We cannot say Singapore has become an ICO hub yet, as more work needs to be done, but yes, there has been a lot of activity since September last year,” said Anson Zeall, chairman of the Association of Cryptocurrency Enterprises and Startups Singapore.
Zeall and others have linked the increase with China’s retreat in ICOs. In September, Beijing defined an ICO as an illegal fundraising tool after concerns over financial scams and money laundering. Dozens of ICO platforms in the country have since shut down.
An ICO is a digital token-based fundraising mechanism through which companies create and sell their own virtual currency in exchange for cash or widely accepted cryptocurrencies, such as bitcoin.
Further, the buyer of the token can use it to pay for goods or services the company offers, or stash it away as an investment.
Last year, Singapore became the world’s third-largest ICO launch pad in terms of money raised, after the United States and Switzerland, according to a report from information portal Funderbeam.
The only other Asian markets that saw significant ICO activity were Russia and Hong Kong, the report also said.