Mainland Firms’ RWA Operations in Hong Kong Plunge Over 90% Amid Regulatory Alerts
Seven Chinese financial industry associations declare RWA tokenization illegal, extending prohibitions to onshore and Hong Kong Web3 service chains.
Seven major Chinese financial industry associations have jointly declared that real-world asset (RWA) tokenization is an illegal financial activity, prohibiting domestic participation in RWA token issuance or trading. The ban targets both onshore operations and Hong Kong Web3 service chains involving mainland entities. The announcement has led to over a 90% drop in inquiries for Hong Kong RWA projects run by mainland firms, with most ventures paused. Related stock prices have fallen sharply, in some cases by half, underscoring the significant impact of the regulatory crackdown on cross-border blockchain-based asset initiatives.
- Real-World Asset (RWA) Tokenization: The process of creating blockchain-based tokens that represent ownership of physical or traditional financial assets.
- Web3: A decentralized internet ecosystem built on blockchain technologies, enabling peer-to-peer transactions and smart contract-based services.
- Token Issuance: The creation and distribution of digital tokens, often used to represent value or asset ownership on a blockchain.