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China tells brokers to pause real-world asset tokenisation in Hong Kong

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China’s securities regulator (CSRC) has quietly advised several domestic brokerages to halt their real-world asset (RWA) tokenisation activities in Hong Kong, according to sources familiar with the matter. The move highlights Beijing’s caution as Hong Kong accelerates its push to become a regional hub for digital assets.

What’s happening

  • At least two major Chinese brokerages received informal instructions in recent weeks to pause RWA tokenisation businesses offshore.

  • RWA tokenisation converts traditional assets — like stocks, bonds, funds, and real estate — into blockchain-based digital tokens.

  • Regulators are concerned about risk management and whether firms’ claims are backed by “strong, legitimate businesses.”

Market reaction

  • Shares in Chinese brokerages with Hong Kong exposure slumped:

    • Guotai Junan International fell 7.25%

    • GF Securities dropped 2%

  • The broader Hang Seng Index closed down 0.9%.

Regulatory backdrop

  • China banned cryptocurrency trading and mining in 2021, citing financial stability risks.

  • While Hong Kong has rolled out a stablecoin regime and tokenisation “sandbox” (Project Ensemble), Beijing has kept its stance restrictive.

  • Last month, regulators told major Chinese brokers to stop publishing research endorsing stablecoins, signalling unease about speculative hype.

  • The HKMA confirmed it is conducting a legal review of tokenisation, initially focused on bonds.

Virtual asset enthusiasm in Hong Kong

  • GF Securities (HK unit) launched yield-generating “GF tokens” in June, tied to USD, HKD, and offshore RMB.

  • CMBI recently helped Shenzhen Futian Investment raise 500 million yuan through an RWA-based digital bond.

  • Seazen Group, a Chinese property developer, set up an institute in Hong Kong to explore tokenisation.

  • HKMA said 77 firms have expressed interest in applying for a stablecoin license as of August 31.

Global context

  • The RWA market is worth about $29 billion today and could exceed $2 trillion by 2030, according to industry forecasts.

  • Hong Kong wants to capture this growth, but Beijing’s intervention shows cross-border limits remain.

  • It’s unclear how long the CSRC’s guidance will stay in place or whether it will become a formal restriction.

China to Launch New STAR Market Segment for Pre-Profit Growth Companies

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China’s securities regulator announced plans to create a new segment within Shanghai’s tech-focused STAR Market designed specifically for pre-profit growth companies, aiming to bolster innovation amid rising China-U.S. tensions in trade and technology.

The upcoming “growth segment” will support companies that have yet to turn a profit but demonstrate significant technological breakthroughs, strong commercial potential, and substantial investment in research and development, according to guidelines from the China Securities Regulatory Commission (CSRC).

CSRC Chairman Wu Qing emphasized the need for robust capital market support for both tech giants and emerging startups, highlighting ongoing reforms to strengthen China’s financial ecosystem amid shifting global economic and trade dynamics.

The regulator will also establish mechanisms to bring in experienced institutional investors to the STAR Market, reinforcing its role as a platform to advance China’s strategic goal of achieving technological independence and global leadership.

The CSRC further pledged to facilitate listings from companies working on frontier technologies, including artificial intelligence and aerospace, aligning with China’s ambitions in cutting-edge sectors.

This move comes as many Chinese firms are considering public listings in Hong Kong, which is actively attracting new listings amid a recovering stock market environment.

China to Streamline Rules for Overseas Tech Listings, Vows Greater Support for Startups

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China’s securities regulator will establish a more transparent and predictable regulatory framework to support technology firms seeking overseas listings, a senior official announced Thursday, signaling Beijing’s renewed push to boost capital access for its tech sector amid intensifying U.S.-China tensions.

Speaking at a news briefing, Yan Bojin, Chief Risk Officer at the China Securities Regulatory Commission (CSRC), said the regulator aims to simplify procedures and safeguard fund usage, ensuring capital raised from IPOs is channeled directly into core business operations rather than speculative activities.

“We will support more high-quality, unprofitable tech companies to go public,” Yan said, referencing China’s desire to emulate Western models of nurturing early-stage innovation through public markets.

Key Highlights:

  • Improved regulatory clarity for tech firms listing abroad

  • Stronger oversight on how IPO funds are used

  • Expanded support for pre-profit tech startups to access equity markets

  • Further reforms to Shanghai’s STAR Market and Shenzhen’s ChiNext board

  • Encouragement for “red-chip” tech companies (Chinese firms listed in Hong Kong) to consider domestic IPOs

Strategic Context

The policy update comes amid:

  • Beijing’s push for tech self-sufficiency, especially in semiconductors and AI

  • Escalating U.S. export controls and investment restrictions targeting Chinese tech firms

  • Efforts to keep promising Chinese startups within domestic capital markets, rather than relying heavily on U.S. IPO routes

The CSRC’s focus on “red-chip” firms also suggests efforts to strengthen Hong Kong’s role as a financial bridge while still drawing key players back to mainland exchanges.

Implications

The shift is seen as part of a broader capital markets reform agenda that aims to:

  • Enhance investor confidence

  • Deepen tech financing channels

  • Retain strategic tech assets within China’s influence

  • Reduce dependence on Western listing venues, particularly as geopolitical risks mount

While regulatory challenges and global tensions remain, the announcement marks a clear signal that Chinese authorities are seeking to balance market openness with national security priorities.