The China Securities Regulatory Authority (CSRC) has advised several local brokerages to halt their real-world asset (RWA) tokenization activities in Hong Kong. At least two major brokerages have received informal warnings in this regard, according to sources.
Chinese Regulator Puts Brakes on RWA Tokenization Activities in Hong Kong
RWA tokenization involves converting traditional financial assets like real estate, bonds, or commodities into blockchain-based digital tokens. While this area has attracted interest from institutional investors globally, China has been cautious.
Hong Kong has recently been taking steps toward its goal of becoming a leading digital asset hub in Asia. While the territory provides a relatively more liberal environment for crypto exchanges and token-based financial products, mainland China is more cautious, citing financial stability and risk management concerns.
According to experts, the CSRC’s warning is a reflection of Hong Kong’s search for a balance between its digital asset strategy and Beijing’s strict regulatory focus.
Industry analysts say the temporary restriction on Chinese brokerages raises questions about whether it will limit Hong Kong’s appeal to global investors.
However, market players are unanimous in their view that in the long term, Hong Kong will not back down from its goal of creating a safe environment for digital assets by clarifying the regulatory framework.
*This is not investment advice.