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China’s ambiguous cryptocurrency regulations are driving startups overseas, according to 500 Startups partner Edith Yeung.

Yeung — head of greater China at the global venture capital seed fund— spoke to TechNode on Nov. 20 at TechCrunch Shenzhen 2018. She said that China is “one of the hardest places” to launch new blockchain projects.

While Yeung stressed that the Chinese government is supportive of blockchain innovation (Shenzhen and Hangzhou governments both launched blockchain funds this year) rules around cryptocurrency are ambiguous, with repeated crackdowns on cryptocurrency exchanges.

Yeung said that regulations in China are hard to predict. “It’s more or less just wait and see,” she said. “The regulatory environment will sort itself out later.”

If blockchain startups hope to create their own token—or even have the option to do so in the future—they often choose to open offices overseas, Yeung said.

“Because what is going on in China is not clear, I am seeing more and more even Chinese projects actually going overseas,” she said. “All these guys are—from day one—thinking about international. They are not only sitting in Shenzhen or Beijing. They are thinking, OK from day one I need to have an office in San Francisco, in Berlin.”

Cassidy McDonald is a Beijing-based multimedia journalist who covers technology's effect on Chinese society. She tweets at @CMcD123.

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