The People’s Bank of China, the China Securities Regulatory Commission, and six other government agencies recently issued the "Notice on Further Preventing and Handling Risks Related to Virtual Currency and Other Relevant Activities." For the first time, this document explicitly designates activities related to the tokenization of real-world assets (RWA) as a regulatory focus.
The new regulation establishes the principle of "strict prohibition domestically, strict supervision abroad," banning RWA tokenization activities and related services within China.
At the Eye of the Storm: The New RWA Regulatory Framework
Eight agencies jointly released the "Notice on Further Preventing and Handling Risks Related to Virtual Currency and Other Relevant Activities," directly addressing the risks associated with virtual currencies and RWA tokenization. Published on February 6, 2026, this document marks a new phase in China’s regulation of crypto assets.
RWA tokenization is clearly defined as the use of cryptographic technology, distributed ledgers, or similar technologies to convert asset ownership and income rights into tokens or similar equity certificates, followed by issuance and trading.
According to this notice, conducting RWA tokenization activities or providing related intermediary or IT services within China constitutes illegal financial activity and is prohibited.
Dual Regulatory Approach: Strict Domestic Ban and Rigorous Overseas Oversight
The regulatory policy adopts a clear dual structure. Domestically, all RWA tokenization business is completely banned.
The notice specifies that conducting RWA tokenization activities or providing related services within China may involve illegal issuance of tokens, unauthorized public offerings of securities, and other unlawful financial activities.
Overseas activities are subject to strict regulation. Domestic entities conducting asset securitization-like RWA tokenization based on domestic rights outside China must comply with the "same business, same risk, same rules" principle.
The China Securities Regulatory Commission has issued supporting guidelines titled "Regulatory Guidance on Overseas Issuance of Asset-Backed Security Tokens Based on Domestic Assets," implementing a stringent filing system and clarifying a negative list for these activities.
Deeper Regulatory Logic: Risk Control and National Interests
Regulators view RWA tokenization as a major risk, driven by multiple considerations. Recently, speculative activities involving virtual currencies and RWA tokenization have disrupted economic and financial order.
Such activities may be used for money laundering, illegal fundraising, and other criminal acts, threatening the financial security of the public.
From a macro perspective, regulation aims to prevent illegal cross-border capital flows through RWA tokenization channels, safeguarding financial stability and national security.
Regulators also seek to prevent risks of financial arbitrage associated with RWA tokenization, ensuring financial resources serve the real economy.
Market Impact: Divergence and Compliance Opportunities
China’s new regulatory framework has triggered divergent market reactions. Following the announcement, certain RWA-related stocks saw gains.
Guotai Junan International and GCL Energy Technology, among others, experienced notable increases, with GCL Energy Technology’s stock price reaching a five-month high.
Meanwhile, the regulatory framework is shifting the industry from "unregulated growth" to a "compliance race." Platforms and intermediaries able to meet compliance requirements will have more opportunities.
Market analysts believe the new rules will eliminate non-compliant projects and create opportunities for tech companies capable of providing compliant data management services.
Industry Warning and Future Outlook
The new regulations send a clear warning to the crypto industry. Businesses and sole proprietors are prohibited from including terms like "virtual currency," "real-world asset tokenization," or "RWA" in their registered names or business scopes.
All types of trading venues are forbidden from participating in RWA token issuance and trading activities within China, and must not directly or indirectly provide services for RWA token business conducted domestically.
Looking ahead, RWA tokenization business is likely to move toward a highly regulated environment. Overseas issuance will require prior filing and strict compliance with regulatory requirements.
Regulators will strengthen cross-border regulatory cooperation and information sharing with overseas securities authorities, forming a global regulatory network.
Conclusion
As of February 9, mainstream crypto asset markets are exhibiting divergent trends. Regulatory policy changes have become a key factor affecting asset prices, similar to the recent Aave governance crisis, which led to a 19% drop in one week.
Facing the new landscape of "strict prohibition domestically, rigorous supervision abroad," RWA-related projects are undergoing compliance screening. Projects that can adapt to regulatory requirements and build transparent frameworks may find their place in the reshuffled market.
The regulatory framework draws clear boundaries while leaving room for compliant development. This signals the crypto industry is transitioning from a period of wild growth to a new cycle of regulated development.
