South Korea has become the latest country to pull the plug on Initial Coin Offering (ICO) related activities.

In a meeting held today, the Financial Services Commission (FSC), a central government body responsible for financial policy and financial supervision in South Korea, said that it will ban all fundraising activities in the country conducted through virtual currencies, Reuters reported. The finance ministry, the Bank of Korea, and the National Tax Service (NTS) also attended the meeting.

“Raising funds through ICOs seem to be on the rise globally, and our assessment is that ICOs are increasing in South Korea as well,” the FSC said (as quoted by Reuters).

The regulator said that it will ban all kinds of ICOs as it intends to bring trading of virtual currencies under the regulatory system. However, this does not mean that the government has accepted virtual currencies trading as part of its financial system, the FSC clarified adding that it will closely watch this space.

The regulator went on to state that it will impose “stern penalties” on the entities that are involved in ICOs. The intention to punish parties involved in ICOs was revealed earlier this month when the FSC held a joint task force meeting with digital currency-related institutions and regulators, including the Korea Fair Trade Commission (KFTC) and the NTS. According to THEblockchain, the authorities said that they will punish ICO that raises funds in the form of stock issuance using digital currencies.

According to local news source, the FSC also said that it plans to conduct inspections of banks’ anti-money laundering (AML) obligations in January 2018, for banks that have issued savings accounts to virtual currency businesses.

South Korea’s ban on ICOs follows a similar ban imposed by Chinese authorities earlier this month.

FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest