Beijing: China has intensified its regulatory scrutiny of emerging digital financial products by issuing new guidelines for tokenised asset backed securities (ABS) tied to onshore assets but sold in overseas markets. The China Securities Regulatory Commission (CSRC) cited concerns over speculative trading and potential threats to financial stability as the primary motivation behind the move.
Under the new rules, domestic entities controlling the underlying assets must submit full offshore offering documents to the CSRC before issuance. Detailed disclosures about both the assets and the structure of the tokenised instruments are mandatory. Approved filings will be publicly disclosed on the CSRC’s website, enhancing transparency and providing investors with authoritative information on regulated products.
The regulation also explicitly bars issuance of tokenised ABS in cases where the underlying assets or the entities controlling them face legal prohibitions, unresolved ownership disputes, national security concerns, or ongoing criminal or major regulatory investigations. The CSRC emphasized that the guidelines will be implemented immediately and that it will cooperate with overseas regulators to manage cross border risks associated with such offerings.
While real world asset (RWA) tokenisation has attracted global interest, the CSRC noted that this guidance applies narrowly to securities-based structures involving Chinese onshore assets. Despite the growing enthusiasm among Chinese companies for offshore funding opportunities, particularly in Hong Kong, the market for blockchain-based RWA tokenisation remains in its infancy. Analysts caution that high supply could face limited demand, especially due to investment restrictions for mainland Chinese investors.
The CSRC’s move reflects Beijing’s broader strategy of balancing financial innovation with risk containment, ensuring that digital asset experimentation does not compromise the stability of China’s financial system. As the tokenisation market evolves, both domestic and international investors will be closely monitoring regulatory developments and market responses.