China on Monday banned individuals and organisations from raising funds through initial coin offerings (ICO), or launches of digital currencies, saying the practice constituted illegal fund-raising.

ICOs have become a bonanza for digital currency entrepreneurs, globally and in China, allowing them to raise large sums quickly by creating and selling digital “tokens” with little or no regulatory oversight.

“Individuals and organisations that have completed ICO fund-raisings should make arrangements to return funds,” said a joint statement from the People’s Bank of China, the securities and banking regulators and other government departments, that was posted on the central bank’s website. The prices of bitcoin and ethereum, two of the largest cryptocurrencies, slumped after the announcement.

Zennon Kapron, Director of the Shanghai-based financial technology consultancy Kapronasia, said he suspected regulators were putting the brakes on ICOs in order to better understand the phenomenon but could ease off in the future.

“Regulators globally are struggling to understand what ICOs are, what the risks are, and how to ring-fence and regulate them,” he said.

The popularity of coin offerings has surged in China this year. In July, the state news agency Xinhua said there had been 65 ICOs so far during the year raising a combined 2.62 billion yuan ($394.6 million) from 105,000 individuals in the country.