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Author: Xie Zhaoqing, Source: Tencent News “Vision”
Hong Kong’s financial circle begins to be stratified: Foreign institutions are still studying quantification, hedging and IPO as usual;In addition to these, Chinese-invested institutions have added a new task – researchRWA(Real World Assets).
RWA refers to the real world assets, especially those that can generate stable income, such as hotel leasing, photovoltaic power generation, and even stocks, bonds, commodities, etc., which can be tokenized through blockchain technology, so that they can be traded, managed and circulated on the chain.
“This is the arrangement of the domestic headquarters, and most of the brother institutions are trying hard.” Several financial practitioners of Chinese-funded institutions in Hong Kong told Tencent News “Vivid” that they will “try to implement the RWA project.”Some people directly call it “proposition assignment or designated homework.”
A head of a leading fund company in Hong Kong told Tencent News “Vision” that many institutions have received requests from domestic headquarters in the past period to try to explore business opportunities for RWA projects.
Tencent News “Vision” learned that, like most financial products in Hong Kong are implemented, these Chinese financial institutions need a large number of lawyers to participate in exploring RWA projects.This has also led to the increase in business of some law firms in the currency sector in Hong Kong, including King & Wood Malleson Law Firm and Junhe Law Firm.
This makes practitioners of Chinese-funded institutions in Hong Kong even busier.On August 7, Ant Digital Technology and other institutions held an industry meeting on RWA on the Hong Kong Stock Exchange. Among them, Vice Chairman of the National Committee of the Chinese People’s Political Consultative Conference and former Chief Executive of the Hong Kong Special Administrative Region Leung Chun-ying, Director of the Financial Affairs and Treasury Affairs of the Hong Kong Special Administrative Region Government, and Xu Zhengyu, Director of the Financial Affairs and Treasury Affairs Bureau of the Hong Kong Special Administrative Region Government, attended the meeting.The organizers may have underestimated the enthusiasm of the Hong Kong financial circle for this. When the venue opened at 2:30 pm that day, the venue was full, and most people had no seats and stood behind the venue.
“I haven’t seen the currency circle hold an event in Hong Kong for a long time. So many people from traditional institutions have come.” A person from a traditional financial institution told Tencent News “Viano” on the spot that he met many acquaintances in the circle.
1. Chinese financial institutions in Hong Kong actively try RWA
“If the Hong Kong Stablecoin Ordinance had not been launched, there would not have been this wave of Chinese enthusiasm.” A head of a leading asset management institution in Hong Kong summarized the reasons in this way.
Like him, executives who work in Chinese asset management institutions have traveled to the mainland and Hong Kong many times in the past, discussing possible business opportunities in Hong Kong under the implementation of stablecoin with headquarters and some local regulatory agencies.
A head of asset management of state-owned enterprises sent to Hong Kong from abroad told Tencent News “Cantone” that “the current wave is actually top down (top-down). The headquarters hopes that institutions stationed in Hong Kong will try to do RWA to prepare for the ecological development after the issuance of stablecoins in the future.”
Before this, except for Chinese institutions such as Huaxia Fund Hong Kong Company, Taiping Asset Management Hong Kong Company, Jiashen Fund, and Bose Fund issued some currency circle products in Hong Kong, most Chinese institutions in Hong Kong have not been involved in currency circle business, and some even have their licenses under Asset Management to be upgraded to the category that can participate in currency circle products.
Public information shows that as the leading Chinese fund company in Hong Kong, Huaxia Fund (Hong Kong) has issued Bitcoin spot ETFs, Ethereum spot ETFs in 2024 and Hong Kong dollar monetary fund tokenization funds in Hong Kong in February 2025, and launched RMB monetary fund tokenization and US dollar monetary fund tokenization funds in July this year.
As of the close of August 21, the scale of Huaxia Fund’s Bitcoin spot ETF was approximately HK$2.072 billion.At the same time, the Bitcoin ETF scales of Jiashishi Fund and Bose Fund are HK$260 million and HK$1.475 billion respectively.
Tencent News “Cantonese” learned that among the money fund tokenization products under Huaxia Fund (Hong Kong) Company, the tokenization scale of Hong Kong dollar funds is about HK$1.2 billion, while the tokenization portion of US dollar funds is US$40 million.
Taibao Asset Management Hong Kong launched its first US dollar money market fund tokenization product (CPIC Estable MMF) in March this year, with an issuance scale of US$100 million.Public data shows that Taibao Asset Management is an asset management institution under China Taiping Insurance Group. Its assets in Hong Kong now exceed HK$70 billion. In September 2023, it upgraded its license number 1 and 4 under license number 1 to participate in virtual asset fund distribution and investment advisory services. It is also the first batch of asset management companies to obtain virtual asset licenses in Hong Kong.
Regarding why US dollar money funds are chosen as the preferred product tokenization, Zhou Chenggang, CEO of Taibao Asset Management, told Tencent News “Vision” that the decision is mainly based on the considerations of investor demand and market liquidity.
Zhou Chenggang explained that money fund tokenized products are relatively easier to understand for institutional investors. In addition, the significance of making tokenized products now lies in exploration and preparation, not in pursuit of scale.
“There are not many suitable financial targets available in Hong Kong now. In addition to the stable money funds, some have tried equity tokenization, and some are even exploring Private Credit (private credit products) tokenization.” The head of a state-owned enterprise fund said that most institutions have not been exposed to currency products before.In mid-to-late July, with the craze of stablecoins in Hong Kong, they had to start “storing” projects, and even some temporary teams formed to build products in order to “handle homework”.
A head of a Chinese-funded institution in Hong Kong told Tencent News “Viano” that this is not surprising, and everyone will have to learn to put on the chain products in the future.In his opinion, more financial products may be put on the chain in the future.
A relatively optimistic Chinese fund head in Hong Kong told Tencent News “Cantone” that in the next 5-10 years, all financial products will now be put on the chain, which can solve the problem of 7×24-hour trading, that is, it will become more efficient and cost-reducing. “The development of the financial industry is consistent with the current trend of AI development, and will face comprehensive changes.”
What excites the people in charge of these Chinese-funded asset management institutions in Hong Kong is that the US market has already had successful pioneers, such as BlackRock.Public information shows that BlackRock listed the Bitcoin spot ETF iShares Bitcoin Trust (IBIT) on the Nasdaq in the United States on January 11, 2024. As of the close of August 20, the fund’s scale exceeded US$86.77 billion, becoming the fastest-growing ETF in history, breaking several industry records.Subsequently, BlackRock launched the iShares USD Money Market Fund (BUIDL), its first tokenized US dollar money market fund on March 20, 2024.
More importantly, RWA is growing very fast in the US market.Public data shows that as of August, the RWA market size was about US$24 billion to US$25 billion (excluding stablecoins), of which the RWA with the underlying assets were private credit exceeds US$13 billion, followed by the RWA with the underlying assets were US Treasury bonds reached US$8 billion, the latter including the tokenized fund BUIDL, a subsidiary of asset management giant BlackRock, which is about US$2.38 billion.
“I want to be China’s BlackRock.” The head of the above-mentioned leading Chinese fund told Tencent News “Vision” that BlackRock, the world’s largest asset management company, “has revolutionized itself.” As a Chinese institution in Hong Kong, “cannot continue to torture in the red ocean such as bonds and stocks in the traditional financial market.”
Only by grasping changes in Hong Kong’s policies and industries can we cater to the development and changes of the entire capital market in a timely manner.This is the original intention of most of the heads of asset management institutions in Hong Kong to lead their teams to flock to RWA products.These optimists believe that the current company strategy is not difficult to understand. Only when technology iteration and early layout can you have the opportunity to overtake the industry and seize new opportunities.
2. Practitioners call for “This is a false fire, so you must be calm.”
However, not everyone believes that the current hot RWA project is suitable for all institutions to participate.Zhou Chenggang, CEO of Taibao Asset Management, told Tencent News “Cantonese” that RWA is “too popular in Hong Kong, this is a false fire, so you have to calm down.”
Optimists who flocked in believe that all financial assets in Hong Kong will be put on the chain in the next 5-8 years.But Zhou Chenggang did not fully agree.He believes that all financial assets will have the opportunity to be listed in the future, but the specific timetable cannot be predicted for the time being, because it depends on the development of the entire RWA ecosystem.
More importantly, not all assets must be put on the chain. The asset chain itself needs to conform to financial logic, and the chain is to solve specific problems.Like many financial practitioners in Hong Kong, Zhou Chenggang recognizes blockchain technology, but he said, “I oppose taking any new technology myth. Many people regard what RWA can do in the future years as things that RWA can do now. This is actually a wrong understanding and will also mislead the market.”
There are also many people who have the same views as Zhou Chenggang.Many fund leaders in Hong Kong (including foreign capital and some Chinese capital) and people in the currency circle said that the issuance of RWA products in Hong Kong at this stage is more to explore the significance of RWA.
An executive who has been in the currency circle for many years pointed out more directly that if RWA’s underlying assets can be quickly financed in the traditional financial field, it means that their liquidity is not bad, and it will not become its first choice in the current RWA market with relatively low liquidity.Similarly, for underlying assets that are not high-quality enough, even if they are put on the chain, their liquidity is still worrying.
“Now the Hong Kong RWA market is at risk of overheating.” Many practitioners in Hong Kong, including Zhou Chenggang, said that they believe that RWA will definitely have a lot of room for development in Hong Kong in the future, but the RWA ecology in Hong Kong is still in a very early stage, including RWA’s financing capacity, liquidity, etc., there is more room for improvement.
With the stablecoin boom, RWA’s popularity has also risen.An asset management person who is planning to implement RWA products with his team revealed to Tencent News “Cantone” that he has contacted many teams who came to contact, and the qualities of these teams are of varying quality, and some teams are not even aware of the legal rights and interests corresponding to RWA assets.
“RWA is actually a product built on a complete legal system.” Zhou Chenggang also has a similar view.He believes that clear legal norms are needed whether it is the equity of investors holding RWA assets or the ownership of the underlying assets corresponding to the equity.
