The Australian Securities and Investments Commission or ASIC has prohibited the country’s Bitcoin Group Ltd from making public statements about its plans to undertake the world’s first IPO of a virtual currency exchange. The decision came after the company approached potential Chinese investors via social media.
The ASIC is an independent Australian government body that acts as Australia’s corporate regulator. Its role is to enforce and regulate company and financial services laws to protect Australian consumers, investors and creditors. The prohibition order from the organization to the Bitcoin Group Lt. is part of its duty.
Nonetheless, ASIC which was established on 1 July 1998 following recommendations from the Wallis Inquiry, has ample authority and scope that is determined pursuant to the Australian Securities and Investments Commission Act, 2001. The latest order to prohibit the Bitcoin company is part of its intentions to regulate the digital currency.
According to the reports the Melbourne-based start-up Bitcoin Group had in December 2014 hoped to raise A$20 million i.e. $15.6 million on the Australian Stock Exchange. It has since then has been seeking expressions of interest from potential investors from the Chinese community through WeChat, a hugely popular Chinese instant messaging online service.
Nonetheless, now that the Bitcoin Group Lt. has been warned by the ASIC from making any further statements about its planned listing until it had filed a prospectus, the market observers believe that it is quite new development. Though there are at least two other publicly traded Bitcoin companies following “backdoor listings,” it will be the first to offer shares in an IPO.
Bitcoin Advocates Resist Regulations
The ASIC order says, “The publications were made before Bitcoin Group Ltd was registered as an Australian company by ASIC and before the lodgment of a formal disclosure document.” It also reads, “ASIC expects companies to be fully aware of their obligations regarding advertising or publicity that occurs before making a regulated disclosure document available to investors.”
According to the ASIC statement the actions related to Bitcoin Group specifically and not to Bitcoin generally. However, it being observed that the move will increase scrutiny on the controversial new virtual currency.
The major feature of Bitcoin is that it is not controlled by a central bank; however, due to various reasons a lot of governments around the world are trying to regulate it.
To contact the reporter of this story: Deepak Tiwari at firstname.lastname@example.org