Against the backdrop of China issuing a ban on all initial coin offerings selling cryptocurrency tokens, the country's blockchain leaders are creating a fund to support ICO projects with Russia's help.
China's Metaverse Foundation says it has worked with Russian crypto investment bank CyberTrust to create the Cryptocurrency Fund to support ICO projects from China and Russia through use of the Moscow-based KICKICO crypto crowdfunding platform.
Viewed as a cross between crowdfunding and an initial public offering, ICOs have gained momentum in the past year, reportedly raising at least $1.25 billion globally through the sale of tokens based on the blockchain technology that drives the movement of bitcoin and other cryptocurrencies.
Until revealing this week it was banning ICOs, China had not taken any type of regulatory stance on ICOs. Many in the bitcoin industry feel the country will eventually establish regulations for the technology.
"I am confident that by our joint efforts we will be able to significantly accelerate and even revolutionize the development of the blockchain industry in both countries," Metaverse Foundation CEO Eric Gu said in a Sept. 6 press release.
"Meanwhile, until Chinese authorities create a new regulatory framework, these ICOs will likely technically be based in Russia," Gu added. "I am, however, convinced that this is likely to be only temporary.“
The Cryptocurrency Fund could accelerate those regulatory discussions, especially with CyberTrust also announcing the launch of its new Russia-focused exchange CyberEX.
In that regard, as both countries are now taking a clearer approach to cryptocurrency legislation, a method of crypto-based financing and integration into existing financial systems is falling into place.
The Shanghai-based Metaverse Foundation and the Moscow-based KICKICO platforms, in conjunction with Swiss-based CyberTrust, is likely to further enhance Russian-Chinese cooperation.
“China is in the process of creating a new regulatory framework to accommodate the blockchain revolution, and we are determined to work together with authorities to make that happen," Gu said. "This new fund can help demonstrate how we can use these new tools to create real added value in both countries.”
In addition to supporting current cryptocurrency projects in both Russia and China, the fund will help develop necessary infrastructure for the emergence of new projects and the adaptation of blockchain technologies in the countries.
Over the next year, the fund partners plan to conduct about 100 ICO projects.