China’s securities regulator has reportedly instructed some brokerages to pause their real-world asset tokenization business in Hong Kong, aligning with Beijing’s cautious stance as Hong Kong pushes forward with digital-asset initiatives.
The China Securities Regulatory Commission (CSRC) has given informal guidance to at least two leading brokerages, asking them to refrain from offshore RWA activities, according to an initial report from Reuters on Monday that cited two individuals familiar with the matter.
Several Chinese firms, including brokerage subsidiaries, have launched or announced tokenized products in the city, per the report.
What is RWA tokenization?
RWA (real-world asset) tokenization is a process that converts regulated assets such as bonds, equities, real estate, or funds into blockchain-based tokens.
The CSRC’s move appears to be motivated by risk-management concerns, with officials reportedly wanting “strong, legitimate businesses.”
The prospects and opportunities in the RWA sector have gained traction in Hong Kong over the past year, following the Hong Kong Securities and Futures Commission’s (SFC) unveiling of a comprehensive roadmap aimed at shaping the city into a global hub for virtual assets.
In August, the SFC launched a new stablecoin licensing regime to help push those efforts further, with some 77 firms showing interest through applications.
A month prior, Shanghai’s state asset regulator held a closed-door meeting to study stablecoins and blockchain infrastructure, signaling that China is pursuing what observers have called a “tiered experimentation” rather than outright liberalization.
Still, Beijing has kept tight restrictions since banning crypto trading and mining in 2021.
A “measured approach”
Observers, however, see it as a cautious gesture.
“It suggests regulators are taking a measured approach to how tokenized assets interact with capital markets, especially across borders,” Jakob Kronbichler, CEO and co-founder of on-chain credit marketplace Clearpool, told Decrypt.
Real-world finance is “already moving on-chain, whether through credit for payments, trading firms, or other institutional use cases,” Kronbichler said, adding that Hong Kong’s licensing framework creates the environment for interested players to grow “even if the broader regional stance takes time to align.”
“China’s informal guidance appears to reflect caution rather than opposition to tokenisation,” Giorgia Pellizzari, head of custody at digital asset financial institution Hex Trust, told Decrypt, adding that regulators “seem to be watching closely how these products link into capital markets, especially across borders.”
For firms in the sector, “the key risks are delays in product launches and increased compliance complexity,” Pellizzari noted. “Longer term, this could reinforce the importance of clear, coordinated rules between jurisdictions.”
In June, GF Securities’ Hong Kong arm rolled out “GF tokens,” yield products tied to major currencies. China Merchant Bank International helped Shenzhen Futian Investment issue a 500 million yuan ($70.2 million) digital bond. Seazen Group also launched a Hong Kong institute focused on tokenization.
Decrypt has reached out to GF Securities, CMB International, and Seazen Group for comment and will update this story should they respond.
Whether these efforts will continue without disruption is unclear.
The uncertainty for firms “operating between Hong Kong and the mainland” is a gap that “could slow cross-border capital flows in the short term,” Kronbichler noted.
Despite this, “the underlying demand for tokenized credit and payment financing hasn’t changed, he said. “This pause is more about calibrating policy than shifting direction, and Hong Kong still offers a clear framework for institutions to keep building.”
