Exactly! NEO lost about half of its price due to this, which was expected from this kind of news. Currently what I'm seeing is that some ICOs are banning Chinese IP Addresses from participating and are editing their Terms of Service to exclude Chinese participants. I still don't know how the refunds will play out, though.
The entire crypto market took a hit because of this, including Bitcoin, because of China's aggression.
After thinking about it some more, I just can't believe that there was any other intention than this.
Now, in one fell swoop, Chinese regulators have: instant control over the leak of such funds from their residents that previously was spilling out of the country into the west, can gain more control over such future wealth distribution than they could with original ICOs (e.g. by subsequently making the "Chinese ethereum" NEO effectively a state-sanctioned distributor of chinese altcoins and dapps going forward), display their strength in worldwide financial markets by demonstrating the impact of a single blow of theirs on the entire crypto market, in a way they could never do with any other asset, and make themselves seem like altruistic protectors of the downtrodden masses that otherwise would have been "hurt" absent their involvement (a.k.a. whitehat).
Damn, the Chinese really know how to play it...
Yeah... China's been a currency manipulator for quite some time, and I guess they thought it was about time they disrupted the crypto market. Unfortunately their move had dire consequences for crypto holders, investors, issuers, ICOs, and basically all people involved in crypto; currently all of the top 50 cryptos took a hit (loss over 24h) except for USDT (which is, by definition, pegged to be $1). I think the "refund" portion of the statement will be screwing a bunch of ICOs over.