China has tightened its regulation of the crypto industry again. Recently, several financial industry associations jointly issued a warning document, explicitly classifying "Real Asset Tokenization (RWA)" alongside stablecoins , worthless cryptocurrencies, and cryptocurrency mining as high-risk illegal financial activities. This not only ends any speculation that the RWA industry was awaiting regulatory clarification but also sends a clear signal of the Chinese authorities' rejection of crypto technology.
Seven major financial associations join forces to declare: RWA is no longer a technological innovation.
Wu Blockchain Blockchain cited an article by crypto lawyer Liu Honglin, pointing out that the China Asset Management Association, China Banking Association, China Securities Association, China Futures Association, China Association of Listed Companies, and China Payment and Clearing Association recently jointly issued a "Risk Warning on Preventing Illegal Activities Related to Virtual Currency".
The document explicitly states that RWA is no longer considered an innovative technology awaiting regulatory definition, but is instead classified as a business model with high financial risk and directly included in the scope of authorities' enforcement.
Such a joint statement is uncommon. Attorney Liu believes that "a collective voice spanning the banking, securities, asset management, and payment systems usually only appears at critical moments when the financial order is in danger, indicating that the Chinese authorities are highly vigilant against the hype surrounding the RWA narrative."
Four red lines drawn at once: RWA is unsustainable.
RWA is essentially about "financing and trading".
In the document, Chinese regulators gave a clear definition of RWA: "The so-called tokenization of physical assets refers to financing and trading activities through the issuance of tokens or rights and debt certificates with token characteristics."
Therefore, RWA's activities may involve illegal fundraising, unauthorized public securities offerings, and illegal futures trading, which directly correspond to the illegal activities clearly defined in China's Securities Law and Measures for the Prohibition of Illegal Financial Institutions and Illegal Financial Business Activities, and may attract law enforcement action.
Uncontrollable external risks stifle innovation.
The authorities specifically pointed out three potential spillover risks of RWA, including "asset fraud, operational failure, and speculation."
This original statement is highly legally oriented, meaning that no matter how the project team packages it as "technological innovation, efficiency improvement, or asset transparency," as long as it involves token issuance, trading, or profit distribution, it will be regarded as illegal fundraising, completely cutting off RWA's space for innovation.
The authorities reiterated that they have never approved any RWA activities.
Finally, the authorities emphasized that Chinese financial regulators "have never approved any RWA-related activities":
Currently, all tokenization businesses and platforms on the market that bear the name RWA lack a legal basis for operation and have no room for exploration or innovation.
The implication is that RWA technology, which had served as a "transitional solution" for a long time after stablecoins were brought under regulatory oversight, has now been drastically cut off by the Chinese authorities.
From project owners and marketing teams to technology outsourcing companies, anyone could be held accountable.
It is worth mentioning that the authorities have specifically emphasized that those who "knowingly or should have known" still provide RWA services will be held legally responsible.
This means that liability will not only extend to the project team, but may also extend to technology outsourcing, consulting, marketing, KOLs, or other intermediary service providers.
It's not a tightening of regulations, but a complete rejection.
Wu Blockchain Blockchain interprets this as a clear regulatory signal: Chinese authorities do not intend to leave any room for the development of RWA technology.
For the industry, this statement signifies that China's RWA industry is no longer a market awaiting regulatory clarification, but has been explicitly excluded from the legitimate financial system. With limited room for maneuver remaining for companies, severing ties with China and moving towards the global market has become one option.
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This article, titled "China Officially Bans RWA Innovation: From Stablecoins to Tokenized Assets, All are Illegal Financial Activities," first appeared on ABMedia, a ABMedia .
