China Issues Major Public Warning Against RWA Tokenization and Crypto Activities

The post China Issues Major Public Warning Against RWA Tokenization and Crypto Activities appeared first on Coinpedia Fintech News

China has issued one of its most forceful crypto warnings to date: Real-World Asset (RWA) tokenization is not welcome at all.

Seven major financial associations, including the National Internet Finance Association of China, released a joint notice urging the public and institutions to stay away from RWAs and virtual currencies, calling them risky, unapproved, and tied to illegal activity.

RWAs Grouped With High-Risk Crypto Activities

In the alert, the associations place RWAs in the same category as stablecoins, meme coins, “air coins” like Pi, and crypto mining.

They stress that China’s regulators “have not approved any real-world asset tokenization activities,” shutting the door on any assumption that RWAs might operate in a grey zone.

The risks they list are straightforward: fake assets, operational failures, speculation, and schemes disguised as innovation. They also warn that RWA tokens can be used for illegal fundraising, unauthorized securities issuance, and even illegal futures operations.

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Crypto Also Back Under the Microscope

The warning includes a reminder that virtual currencies cannot circulate or be used as money in China. Tokens lacking clear tech or commercial value are called out as prone to manipulation and fraud – a message China has repeated before, but rarely with this level of coordination across industry groups.

Stablecoins are also back in focus, following last week’s statement from the PBoC that they fail to meet China’s KYC and AML requirements.

Financial Institutions Told to Step Back Completely

Every member institution is instructed not to participate in, support, or provide services for virtual currencies or RWA tokens – including trading platforms, issuers, or intermediaries.

The notice even warns that domestic staff working for overseas crypto or RWA companies could face liability if they “knew or should have known” they were aiding such activity.

China has now made its position unmistakable, placing RWAs alongside the crypto activities it considers off-limits.

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