China’s Regulatory Crackdown Highlights the Urgent Need for Decentralized Innovation in RWA Tokenization
Chinese regulators have issued their most severe warning to date against real-world asset (RWA) tokenization and cryptocurrency-related activities. Seven major financial associations, led by the National Internet Finance Association of China, jointly declared these practices unauthorized and high-risk. The notice explicitly groups RWAs with speculative crypto assets like meme coins and stablecoins, emphasizing their potential for fraud and illegal fundraising.
The coordinated statement leaves no room for ambiguity—China maintains its prohibition on all VIRTUAL currency circulation and monetary use. Tokens lacking tangible technological or commercial value face particular scrutiny as vehicles for market manipulation. This marks a significant hardening of Beijing's stance, with regulators now framing crypto innovation as systemic risk rather than economic opportunity.
