China Tightens Grip on RWA Tokenization, Labels It High-Risk

China's financial regulators have escalated their crackdown on real-world asset (RWA) tokenization, categorizing it as a high-risk activity alongside banned crypto practices. The move signals a decisive shift in Beijing's stance, effectively closing the door on potential pilot programs and reinforcing the dominance of the digital yuan.

Key industry associations have aligned RWA projects with prohibited activities like stablecoins and mining, warning of enforcement actions against platforms offering related services. The coordinated notices emphasize that no RWA activity has been approved under existing financial regulations, citing risks of false assets and speculative behavior.

This regulatory hardening comes as the U.S. advances its own digital asset framework, creating a stark contrast in global approaches to blockchain innovation. Market participants now face heightened compliance risks as China redirects focus toward its central bank digital currency initiative.