Regulatory Storm Approaching: Why Have Eight Chinese Departments Listed RWA Tokenized Assets as a Key Risk?

The People’s Bank of China, China Securities Regulatory Commission, and six other departments recently jointly issued the “Notice on Further Preventing and Disposing of Risks Related to Virtual Currencies and Other Areas.” This document explicitly identifies activities related to the tokenization of real-world assets as a regulatory focus for the first time.

The new regulations establish the principle of “strict prohibition domestically and strict regulation abroad,” banning RWA tokenization activities and related services within China.

The Storm Center: New RWA Regulatory Framework

The eight departments jointly released the “Notice on Further Preventing and Disposing of Risks Related to Virtual Currencies and Other Areas,” directly addressing the risks associated with virtual currencies and RWA tokenization. This document was published on February 6, 2026, marking a new phase in China’s regulation of crypto assets.

Real-world asset tokenization is explicitly defined as using cryptographic technology and distributed ledger or similar technology to convert asset ownership and income rights into tokens or similar rights certificates, which are then issued and traded.

According to this notice, conducting RWA tokenization activities and providing related intermediary and information technology services within China are suspected of illegal financial activities and should be prohibited.

Dual Regulatory Track: Strict Ban Domestically and Strict Regulation Abroad

The regulatory policy exhibits a clear dual structure. Domestically, RWA tokenization activities are fully prohibited.

The “Notice” explicitly states that conducting RWA tokenization activities and providing related services within China, suspected of illegal issuance of tokens or securities, constitutes illegal financial activity.

Foreign activities face strict regulation. Domestic entities engaging in offshore RWA tokenization based on domestic rights must adhere to the principles of “same business, same risk, same rules” under regulation.

The China Securities Regulatory Commission also issued a supporting guideline titled “Regulatory Guidelines for Domestic Asset-Backed Securities Issued Overseas,” implementing a strict “filing system” for such activities and clarifying a negative list.

Deep Logic of Regulation: Risk Prevention and National Interests

Regulatory authorities view RWA tokenization as a key risk, driven by multiple considerations. Recently, speculative activities related to virtual currencies and RWA tokenization have occurred frequently, disrupting economic and financial order.

These activities could be used for money laundering, illegal fundraising, and other criminal activities, endangering the property safety of the public.

From a macro perspective, regulation aims to prevent illegal cross-border capital flows through RWA tokenization channels, maintaining financial stability and national security.

Regulators also seek to prevent the risk of financial hollowing out caused by RWA tokenization, ensuring that financial resources serve the real economy.

Market Impact: Segmentation and Opportunities for Compliance

China’s new regulatory framework has triggered market segmentation. After the announcement, some stocks related to RWA saw gains.

Shares of Guotai Junan International, GCL Technology, and others rose significantly, with GCL Technology reaching a five-month high.

Meanwhile, the regulatory framework is expected to shift the industry from “unregulated growth” to “compliance competition.” Platforms and intermediaries that meet compliance requirements will have more opportunities.

Market analysts believe that the new rules will eliminate non-compliant projects and create opportunities for tech companies capable of providing compliant data management services.

Industry Warnings and Future Outlook

The new regulations send a clear warning to the crypto industry. Companies and individual businesses are prohibited from including terms like “virtual currency,” “real-world asset tokenization,” or “RWA” in their registration names and business scope.

All types of trading platforms are prohibited from participating in RWA token issuance and trading activities within China, and they cannot directly or indirectly provide related services to clients for RWA token activities within the country.

In the future, RWA tokenization is likely to develop toward high regulation. Offshore issuance will require prior filing and compliance with strict regulatory requirements.

Regulatory agencies will strengthen cross-border cooperation and information sharing with overseas securities regulators to form a global regulatory network.

Summary

As of February 9, the mainstream crypto asset market has shown segmentation. Changes in regulatory policies have become a significant factor influencing asset prices, similar to the recent market logic where Aave dropped 19% within a week due to governance crises.

Faced with the new pattern of “strict prohibition domestically and strict regulation abroad,” RWA-related projects are undergoing compliance screening. Projects that can adapt to regulatory requirements and establish transparent frameworks may find their place in the reshuffled market.

The regulatory framework both draws clear red lines and leaves room for compliant development. This marks a transition of the crypto industry from a phase of wild growth to a new cycle of regulated development.