Regulators are about to begin scrutinizing China's initial coin offerings — an industry worth hundreds of millions of dollars.

Local outlet Caixin reported that a notice, issued by a working committee that oversees risk in the country's internet finance sector, said new projects raising cash or other virtual currencies through cryptocurrencies will be banned. It added that authorities will crack down on related fraudulent practices.

The document defined initial coin offerings (ICOs) as an unauthorized fundraising tool that may involve financial scams, the Caixin report noted. The committee provided a list of 60 major ICO platforms for local financial regulatory bodies to inspect.

Seven government administrations including the People's Bank of China, China Securities Regulatory Commission, China Banking Regulatory Commission and China Insurance Regulatory Commission issued a joint statement where they reiterated that ICOs are unauthorized illegal fund raising activity.

The statement said authorities are banning all organizations and individuals from raising funds through ICO activities and that all banks and financial institutions should not do any business related to ICO trading.

Organizations and individuals that have completed fundraising through ICOs should make relevant arrangement to return funds, in order to protect the interests of investors and properly deal with risks.

The statement added that enhanced management is needed on digital coin fundraising platforms.