South Korea’s financial regulator announced Friday that it would ban all initial coin offerings effective immediately.

Even further, all virtual currency trading will be more tightly controlled and monitored by the government.

According to local reports Friday, the decision was made after a meeting of senior officials from relevant ministries, led by the Financial Services Commission. Kim Yong-beom, vice chairman of the FSC, is quoted as saying at the meeting that “there is a situation where money has been flooded into an unproductive and speculative direction.”

Although the ruling seems clear, Crypto Korean, a South Korean news service covering the industry, said on Twitter that there is confusion over the ruling, with some saying that the ban does not extend to foreign ICOs in the country.

Muddling the matter even further, they also point to confusion given that Kakao Stock, a popular Korean securities trading app based on the country’s No. 1 smartphone messenger app Kakao Talk, launched a cryptocurrency exchange called Upbit with support for over 110 cryptocurrencies earlier this week. The implication seems to be that while ICOs may now be banned, the trading of cryptocurrencies having previously been issued in ICOs may not be.

South Korea is the second country recently to ban ICOs. China went down the same path earlier this month. There’s no suggestion at this stage that South Korea may ban cryptocurrency trading outright, but the ICO ban in China was subsequently followed by a ban on all bitcoin exchanges.

No ban on ICOs appears to be planned in the United States, but the Securities and Exchange Commission is currently investigating them and some believe that it may only be a matter of time until the country issues restrictions. Some ICOs have already stopped accepting applications from U.S. investors on a strong belief that a ban or crackdown of some sort is likely.

The prices of both bitcoin and Ethereum, the latter primarily used in ICOs, were plunging early Friday morning as news of the ban spread. BTC was trading down over $100 while ETH was down around 8 percent to $280 as of 1 a.m. EDT.

Picture: Jeon Han/ Wikimedia Commons