TechFlow News: On February 22, according to Caixin, eight Chinese government departments—including the People’s Bank of China—jointly issued the “Notice on Further Preventing and Addressing Risks Related to Virtual Currencies and Other Matters” (hereinafter referred to as the “Circular No. 42”), marking the initial emergence of a regulatory framework governing the overseas issuance of Real World Assets (RWA) backed by assets located within mainland China. The overarching principle set forth in Circular No. 42 is an outright ban on RWA issuance within mainland China, coupled with stringent oversight of RWA issuance overseas. According to regulatory insiders, Hong Kong is one of the designated overseas jurisdictions for RWA issuance; RWAs backed by assets located in the Hong Kong Special Administrative Region fall outside the scope of regulation under Circular No. 42 and are not subject to supervision by mainland regulators. Currently, no RWAs backed by underlying assets such as mainland-listed securities or funds have been issued in Hong Kong or other overseas jurisdictions. Should such RWAs ever emerge, they would fall under the purview of the Institutional Department of the China Securities Regulatory Commission (CSRC). Previously, all such cross-border RWA activities were categorically prohibited. While the current stance is no longer phrased as an absolute prohibition (“not all are banned”), strict regulation remains firmly in place for any RWA issuance involving the outbound transfer of mainland-based assets. Importantly, this shift carries no connotation of “encouragement,” and must absolutely not be interpreted as promoting industry development.
Risk Disclosure: This website's content is not investment advice and offers no trading guidance or related services. Per regulations from the PBOC and other authorities, users must be aware of virtual currency risks. Contact us / support@techflowpost.com ICP License: 琼ICP备2022009338号
