block.one, the open source software and blockchain company developing EOS, has announced to exclude Chinese residents from participating in the EOS Initial Coin Offering (ICO).

The announcement follows the recent decision from the Chinese authorities to ban all ICO related activities in the country. However, on the basis of legal advice from a leading law firm, the startup said that its EOS tokens do not fall within the definition of security and their distribution is not considered illegal under respective laws in China.

It added:

“While this legal advice continues to be accurate, due to the changing regulatory environment in the PRC with respect to the distribution of cryptographic tokens generally, block.one has decided as a matter of prudence to exclude citizens and residents of the PRC and entities formed under the laws of the PRC (collectively, “Chinese persons”) from purchasing EOS Tokens effective immediately.”

“Chinese persons are strictly prohibited and restricted from using the EOS Smart Contract and/or purchasing EOS Tokens. If a Chinese person uses the EOS Smart Contract and/or purchases EOS Tokens, such person has done so and entered into the EOS Token Purchase Agreement on an unlawful, unauthorized and fraudulent basis and such agreement will be null and void.”

block.one is a developer of technology solutions including blockchain software development. It is the company behind EOS – a blockchain operating system designed to support commercial decentralized applications. On June 26, EOS announced the opening of its yearlong token distribution.

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