China Bans RWA Tokenization, Issues Strict Legal Warnings

China has declared real-world asset tokenization illegal, warning that all related activities, including support roles, are banned and subject to legal action. No RWA projects are approved, and risks include fraud and speculation.

China has officially declared real-world asset (RWA) tokenization an illegal financial activity, issuing a joint notice through seven major financial industry associations. The notice states that all RWA-related fundraising, trading, and support activities are unlawful and may result in legal action for both domestic and overseas participants, including developers, marketers, and service providers. Authorities emphasized that no RWA activity has been approved by Chinese regulators and that such operations are grouped with other banned crypto activities like stablecoins and mining. The statement highlights risks such as fraudulent assets, operational failures, and speculative hype, and clarifies that offshore registration does not exempt teams operating in mainland China from liability. The move marks a comprehensive rejection of RWA tokenization, ending any prospects for pilot programs and aligning with China’s broader efforts to control digital asset activities and maintain financial stability.