Chinese authorities have tightened control over the activities of companies in the digital asset space outside the mainland. Two Reuters sources reported that in recent weeks, the China Securities Regulatory Commission (CSRC) recommended that several brokers suspend projects involving the tokenization of real-world assets (RWA) in Hong Kong.
These were informal instructions aimed at limiting new initiatives and strengthening risk management. The CSRC requires that businesses announcing tokenized instruments provide reliable, verified collateral. According to the sources, at least two large brokers received such instructions.
Tokenization of RWAs makes it possible to turn stocks, bonds, funds, and real estate into digital tokens for trading on the blockchain. In recent months, several Chinese companies have launched such products in Hong Kong.
Why Hong Kong Became the Center of Tokenization
Beijing’s decision contrasts with Hong Kong’s course, which over the past year has actively promoted initiatives in the field of cryptocurrencies and virtual assets. The region’s financial authorities launched a licensing regime for stablecoins, and the Hong Kong Monetary Authority (HKMA) reported that by August 31, 77 companies had expressed interest in obtaining licenses.
At the same time, the CSRC has been tightening its approach. In August, the regulator had already asked major brokerage firms to refrain from publishing research supporting stablecoins to reduce growing investor interest in digital currencies.
What the Market Expects and Where Companies Are Betting
According to RWA.xyz, the global market for tokenized real-world assets is currently estimated at around $29 billion. Analysts at China Merchants Securities forecast growth of this figure to $2 trillion by 2030.
In June, the Hong Kong division of GF Securities launched “GF tokens” – products with yields pegged to the U.S. dollar, the Hong Kong dollar, and the offshore yuan. In August, China Merchant Bank International helped Shenzhen Futian Investment raise 500 million yuan ($70.29 million) through the issuance of digital RWA-based bonds.
In addition to brokers, developers have also entered the tokenization sector: in August, Seazen Group announced the creation of an institute in Hong Kong to promote RWA projects.
How Restrictions Have Affected Players and Stock Prices
Interest in virtual assets is also fueling the stock market. Guotai Junan International shares surged by more than 400% in June after receiving approval for crypto trading in Hong Kong. Fosun International shares rose by 28% in August after Chairman Guo Guangchang met with regional authorities to discuss stablecoins.
It is not yet clear how long the CSRC’s informal restrictions will remain in place. The commission and Hong Kong regulators have not provided comments.
This post is for informational purposes only and is not advertising or investment advice. Please do your own research before making any decisions.