Li Xiaolai, the founder of Beijing-based venture capital firm Bitcoin investor in China, has publicly stated that he will move away from the blockchain and initial coin-offering (ICO) space.
He said on China's largest Weibo social media platformer:
"From this day on, Li Xiaolai will not invest in any projects (whether it is blockchain or early stage). So, if you see 'Li Xiaolai' associated with any project, just ignore it. I plan to spend several years to contemplate on my career change. As for what I'm doing next, I'm not sure just yet. "
Possible Reasons Behind his Decision
The cryptocurrency market has experienced its fourth worst correction in the past nine years, experiencing an 80% drop in valuation within the past nine months. Ethical and Bitcoin in the market and the ICO market still remains active to this day.
The decision to change the number of companies in the blockchain market.
In June, CCTV, China Central Television, a state-owned network controlled by the government, released to documentary on blockchain .
The statement released by CCTV came from the local cryptocurrency market of China and the global finance industry, especially given the ties of CCTV with the government.
"Blockchain is the second era of the Internet. The value of blockchain is 10 times that of the Internet. Blockchain is the machine that produces trust, "CCTV reported.
The CCTV, the government of China, tightened its blanket ban on crypto, characterizing ICOs as illegal fundraising tools and prohibiting any sales promotion tokens within the country.
An official document released by the government of China
"Such activities are not really based on blockchain technology, but rather the practice of speculative blockchain concepts for illegal fundraising, pyramid schemes and fraud. The main features are as follows:
- Risk of illegal activities, unregulated overseas markets and inability to track or monitor transactions made in ICOs.
- Deceptive, opaque and concealed fundraising methods, relying on celebrities and influencers to manufacture hype around investments to tempt investors.
- Illegal operations like profit-generating pyramid schemes and creating Ponzi schemes by describing them as 'financial innovations.' "
Considering the reputation of a high profile billionaire investor based in China and the government's dissatisfaction with the ICO market, it is highly likely that the local regulations have encouraged Li and his team at Bitfund to move out of the blockchain market.
Not Out of Crypto
Significant amount of Bitcoin and other major cryptocurrencies, which is estimated to be worth over a billion dollars. However, the reputation of the investor is due to his resignation from his role as the managing partner of the $ 1 billion Hangzhou Xiong'An Blockchain Fund. The move was possibly made to recover his / her brand value and remove any association of his fund with illegitimate blockchain projects.
Images from Shutterstock
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