jakiro
Author: Zhang Feng
On November 28, 2025, 13 ministries and commissions, including the People’s Bank of China, the State Administration of Financial Supervision, and the China Securities Regulatory Commission, jointly held a coordination meeting on work related to virtual currencies. Subsequently, seven associations including the China Internet Finance Association and the China Banking Association issued the “Risk Tips on Preventing Illegal Activities Involving Virtual Currencies and Other Related Activities” (hereinafter referred to as the “Tips”), once again clarifying the regulatory stance on virtual currencies and related activities.The document juxtaposes “real world asset tokens” (RWA) with stable coins, air coins, “mining”, etc., triggering extensive market discussion on whether RWA is fully included in “illegal activities related to virtual currencies.”
A careful reading of the text reveals that while the regulatory authorities expressed a firm attitude, they also demonstrated the rationality to treat activities of different natures differently. They did not ban illegal forms such as RWA and stablecoins simply as air coins, but emphasized risk warnings and compliance boundaries, leaving space for understanding of truly compliant and prudent innovations.
1. RWA is not simply classified as “illegal activities”, but emphasizes “multiple risks”
In the text of the “Tips”, there are obvious differences in the descriptions of various types of virtual currency-related activities.For “air coins (such as π coins)”, the document clearly states that it has “no substantial technological innovation, no clear commercial application scenarios and value, the issuance and operation mechanism is opaque, and there are serious problems of fraud and market manipulation.” It also emphasizes that it is often associated with pyramid schemes and fraudulent activities.This kind of characterization is obviously negative and prohibitive.
As for “stablecoins” and “real world asset tokens”,The presentation of the document focuses on risk warnings and description of the current situation.Regarding stablecoins, the document states that they “currently cannot effectively meet the requirements for customer identification and anti-money laundering, and there is a risk of being used for illegal activities such as money laundering, fund-raising fraud, and illegal cross-border transfers of funds.”Regarding RWA, the document explains that its “financing and trading activities through the issuance of tokens or other equity and bond certificates with token characteristics are subject to multiple risks, including false asset risks, business failure risks, speculation risks, etc.” and clearly states that “at present, my country’s financial management department has not approved any real-world asset tokenization activities.”
It can be seen from the wording that the regulators did not directly characterize stablecoins and RWA themselves as “illegal activities”.Rather, it emphasizes its current existenceriskandwithout approvalcurrent situation.This statement contrasts with the explicit prohibition of air coins and reflects the regulatory awareness of distinction.As a technical path to tokenize physical assets through the blockchain, RWA itself has theoretical advantages such as improving liquidity and reducing transaction costs. Regulation does not deny its full potential value, but provides early warning for possible chaos in the current market.
2. The scope of the document’s restrictions focuses on “illegal financial activities” rather than “one size fits all” for the entire industry chain.
The “Tips” put forward clear requirements for various institutions and the public in the second and third parts.Its prohibitive clauses mainly focus on “illegal financial activities”:
> “Domestic institutions and individuals carrying out activities such as legal currency and virtual currency exchange, real-world asset token issuance and financing within the country are suspected of illegal sales of token tickets, illegal fund-raising, unauthorized public issuance of securities, illegal futures business and other illegal financial activities.”
> “It is also an illegal financial activity for overseas virtual currency and real-world asset token service providers to provide services directly or in disguised ways to carry out relevant business activities in my country.”
These regulations clearly point toUnapproved issuance, financing, trading and provision of services activities carried out within the country, the core of its attack lies in the “illegality” of the behavior, rather than the technology or concept itself.The document requires that member units shall not provide related services for “domestic issuance and trading” of virtual currencies and RWA, nor shall they provide services for related “business activities”. The object of regulation is specific illegal and illegal business activities.
This means that if a RWA related activity:
1. It does not involve illegal public issuance or financing within the country;
2. Does not involve providing support for illegal activities within the country;
3. Its operation model itself complies with current financial laws and regulations, such as through legal channels, facing qualified investors, and completing necessary regulatory approvals and registrations;
4. Especially if it can rely on jurisdictions such as Hong Kong that have established a regulatory framework for virtual assets, conduct it in compliance with laws and regulations, and effectively isolate risks from the domestic market;
Then, it may not directly fall into the scope of what is expressly prohibited by the “Tips”.The document aims to cut off the industrial chain support for illegal activities within the country, but does not prohibit all RWA-related technical discussions, international compliance practices or forward-looking research globally.
3. The exploration of compliant RWA should be based on the legal framework and make good use of the rules of the two places.
The RWA we discuss should refer to compliance exploration within the existing legal framework, especially in compliance with the legal requirements of the mainland and Hong Kong and relevant cross-border legal regulations.Since 2022, Hong Kong has gradually established a relatively comprehensive virtual asset service provider (VASP) licensing system and has made regulations for the issuance and trading of financial products such as tokenized securities.In 2023, the Hong Kong Securities and Futures Commission further issued a circular for tokenized securities and collective investment schemes, providing guidance for compliant asset tokenization.
In this context, a compliant RWA project may have the following characteristics:
issuance compliance, i.e.In permitted jurisdictions (such as Hong Kong), the offering is made to qualified investors that comply with local regulations and the necessary registration or approval is completed.
The assets are real, i.e.Correspond to real-world assets that are true, clear, and clearly owned, and establish effective auditing, custody, and information disclosure mechanisms.
Technical compliance, i.e.Meet technical requirements for cybersecurity, data privacy and anti-money laundering/counter-terrorism financing (AML/CFT).
Service isolation, i.e.Related technology development, legal consulting, asset management and other services strictly abide by the laws of the place where the services are provided and do not involve providing direct support for domestic illegal activities.
Investor suitability management, i.e.Strictly implement investor identification and risk tolerance assessment to prevent risks from spreading to the public who do not have the ability to identify them.
Such compliance operations are essentially different from the “false asset risks”, “speculation risks” as well as illegal fund-raising, illegal issuance of securities and other behaviors warned in the “Tips”.The goal of regulatory policies is to “drive out bad money with good money”, crack down on illegal activities, protect the rights and interests of investors, and maintain financial stability, rather than hindering truly valuable and compliant financial technology innovation.
4. Coordination Meeting and “Tips”: Potential benefits for compliance operations and clear warnings for illegal operations
The convening of the work coordination meeting of 13 ministries and commissions and the release of the “Tips” of seven associations can be regarded as a centralized response to the current market chaos and risk elimination.Its core impact is:
Clarify red lines and purify the market: The most direct effect is to severely crack down on and eliminate pyramid schemes, fraud, illegal fund-raising and other activities carried out under the banner of RWA and stable coins (especially air coins such as π coins), to rectify the name of the industry and avoid “bad coins driving out good coins”.
Compacting institutional responsibilities: Require banks, payment, securities, Internet platforms and other various institutions to strengthen due diligence and cut off funding, publicity and technical support channels for illegal activities, which increases the operating costs and risks of illegal activities.
Educate the public and raise awareness: Providing risks to the public through authoritative channels can help reduce irrational speculation and cultivate rational investment concepts.
For institutions and projects that always pursue compliance operations, this policy signal may bring caution to market sentiment in the short term, but in the medium and long term, it is actuallygood: First, the clarification of supervision reduces the uncertainty of “gray areas” and the rules for compliance operations are clearer; second, the purification of the market environment helps compliance projects gain more rational market attention and resource allocation; third, the emphasis on “risk” and “unapproved” rather than “uniform prohibition” leaves a policy interface for future compliance pilots when conditions are mature and rules are clear.
5. Rational considerations with a firm attitude: differentiated treatment and risk-based treatment
Looking at the actions of the thirteen ministries and seven associations, what they show isFirm attitude, but rational thinkingregulatory wisdom.
Firm attitudeThis is reflected in: “zero tolerance” for any form of illegal financial activities and resolute maintenance of national financial security and social stability; attempts to circumvent the current legal framework and conduct illegal issuance, transactions and provision of services within the country are clearly prohibited and severely cracked down; timely statements are made about current market speculation hot spots to control risks.
Rational thinkingIt is reflected in:treat differentlyDifferent types of virtual currency related concepts are prohibited, such as air coins and other activities with obvious fraudulent attributes. For stable coins and RWA, the focus is on reminding their inherent risks and current regulatory status;risk-based, regulatory measures focus on the illegality and risk essence of specific behaviors, rather than “one-size-fits-all” denial of technologies or concepts;leave room, while emphasizing “unapproval” and risks, it did not close the possibility of future compliance exploration on the premise of improving rules and preventing and controlling risks.
This rationality stems from a deep understanding of the complex relationship between financial innovation and risk prevention and control.Blockchain technology and asset tokenization have potential value, but they must be developed in an orderly manner within an effective legal and regulatory framework.The current regulatory posture is a prudent balance that prioritizes the prevention and control of real risks while leaving room for future compliance development.
To sum up, the “Risk Warning” of the Work Coordination Committee of Thirteen Ministries and Seven Associations listed RWA and stablecoins as areas of risk concern, but did not simply equate them with illegal activities such as air coins and prohibit them altogether.The core of the document is to crack down on various illegal financial activities carried out within the country and its industrial chain support, aiming to draw red lines, purify the market, and protect investors.
For market participants, the key is not the concept of fear, but awe of the law and awe of risks.Any exploration involving RWA or stablecoins must put compliance first and strictly abide by domestic and foreign laws and regulations. In particular, it must not involve illegal domestic issuance, trading and provision of services.Compliance and prudent exploration within the existing legal framework, especially in jurisdictions such as Hong Kong that have established relevant rules, are still possible paths.
This regulatory announcement will serve as a “warning sign” and “cleaner” against chaos in the short term. In the long term, it may be a “signal light” and “foundation stone” for the industry to move towards standardized development.It sends a clear message: China’s financial supervision, while adhering to the bottom line of safety, maintains rational observation and evaluation of cutting-edge technologies.There is attitude and rationality. This may be the regulatory norm that the emerging financial technology field must understand and adapt to when seeking long-term development in the Chinese market.Opportunities in the future will belong to those real builders who can not only embrace technological innovation, but also deeply understand and abide by the spirit of compliance.
