The founder of Beijing-based venture capital firm named BitFund made his announcement public that he will no longer invest in blockchain projects or ICOs in the latest crypto news today.
The founder, Li Xiaolai, publicly announced:
“From this day on, Li Xiaolai personally will not invest in any projects (whether it is blockchain or early stage). So, if you see ‘Li Xiaolai’ associated with any project (I have been associated with countless projects without my knowledge, 99% is not an exaggeration), 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.”
There might be a few reasons why Li decided to move away from the crypto sector mostly because of the crackdown on ICOs by the Chinese government and also because of the rise in scams in the crypto space. A Chinese national TV released a documentary about the technology claiming that blockchain has the potential to surpass the success of the Internet.
However, just after the release of the documentary, the government of China tightened the ban saying that ICOs are considered as illegal fundraising tools.
The government stated:
“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.
Illegal operations like profit-generating pyramid schemes and creating Ponzi schemes by describing them as ‘financial innovations.’’
Li does still hold a huge amount of Bitcoin worth billions of dollars but more investors are turning away because the multi-billion investor Li left the crypto space as the major managing partner.
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