Web3 Lawyer's Interpretation: New Regulations from 8 Departments Take Effect, RWA's Regulatory Path Becomes Clear

The People's Bank of China and eight other ministries jointly issued regulatory provisions related to virtual currencies and the tokenization of real-world assets (RWA): the People's Bank of China, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the State Financial Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange issued the "Notice on Further Preventing and Handling Risks Related to Virtual Currencies" (Yinfa [2026] No. 42) (hereinafter referred to as "Document No. 42").

Previously, news of new regulations being issued had circulated in the industry. After the official document was released, it was found to be rich in content. After reading it, Sha Lu felt that almost all of his previous compliance explorations in the RWA field had been hit by the documents from the eight departments and the China Securities Regulatory Commission.

Let's read it quickly:

I. Nature of Document No. 42

In 2017 and 2021, regulators issued Announcement No. 94 and Announcement No. 924 respectively, and since then, no complete legal documents have been issued in this field for a long period of time. The working coordination meeting of thirteen ministries and commissions and the risk warning issued by seven associations at the end of 2025 are not upgrades of formal legal documents. The following is a comparison of the nature of five core related documents:

Key conclusion: Document No. 42 is currently the most accurate and complete legal regulation in the field of virtual currency business, and Announcement No. 924 has been officially repealed with its implementation.

II. Key Differences Between Document No. 42 and Previous Regulatory Documents on Virtual Currency

(1) The scope of regulatory targets has been comprehensively expanded.

1. New core regulatory targets: For the first time, Real-World Asset Tokenization ( RWA ) and stablecoins are included in the core regulatory scope. The regulatory dimension has expanded from simply virtual currency trading and speculation to a three-pronged approach of full-chain regulation encompassing " virtual currency + RWA + stablecoins ".

2. Detailed regulations on stablecoins : It is clarified that " stablecoins pegged to fiat currencies effectively perform some of the functions of fiat currencies in circulation and use," and it is prohibited that "no entity or individual, domestic or foreign, may issue stablecoins pegged to the RMB overseas without the consent of relevant departments in accordance with laws and regulations."

3. RWA explicitly defines it as "the activity of using cryptographic technology and distributed ledger or similar technology to convert the ownership, income rights, etc. of assets into tokens or other rights or debt certificates with token characteristics, and to issue and trade them."

(2) Issuing department and improved legal effect

Document No. 42 was jointly issued by eight departments, including the People's Bank of China and the National Development and Reform Commission, and was also agreed upon by the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate. With the approval of the State Council, the document's level of issuance and legal effect have been significantly enhanced compared to previous documents.

(3) The legal basis has been updated and improved.

The new law adds several higher-level legal bases, including the "Futures and Derivatives Law of the People's Republic of China," the "Securities Investment Fund Law of the People's Republic of China," and the "Regulations on the Administration of Renminbi of the People's Republic of China," providing more comprehensive legal support. At the same time, it removes some documents from the 924 Announcement , such as the "Regulations on the Administration of Futures Trading" and the "Decision of the State Council on Cleaning Up and Rectifying Various Trading Venues and Effectively Preventing Financial Risks," making the application of the law more precise.

(4) The qualitative description of virtual currency has been accurately upgraded.

(5) A New Definition of RWA and Stablecoins

Circular 42 adds a special clause to define the nature of RWA: "Activities involving the tokenization of real-world assets within the territory , as well as the provision of related intermediary and information technology services, which are suspected of illegal issuance of tokens, unauthorized public offering of securities, illegal operation of securities and futures businesses, illegal fundraising, and other illegal financial activities, shall be prohibited; except for related business activities carried out with the consent of the competent business authorities in accordance with laws and regulations and relying on specific financial infrastructure."

The document also explicitly prohibits RWA from providing services outside of China: " Overseas entities and individuals are prohibited from illegally providing services related to the tokenization of real-world assets to domestic entities in any form."

Key conclusion: Combining the above clauses, it can be clearly stated that...

1. The RWA project is located within China, and the service provider is also located within China— this is illegal.

2. RWA project is located in China, but the service provider is overseas – this is illegal.

3. Similar NFT projects are suspected of illegally issuing token vouchers – illegal.

4. The RWA project is located overseas and is suspected of illegal fundraising within China – illegal.

(6) The division of labor among regulatory departments has become more refined, from multi-departmental collaboration to a dual-track regulatory system.

The 924 announcement only established a multi-departmental coordination mechanism: "The People's Bank of China, together with the Cyberspace Administration of China, the Supreme People's Court, the Supreme People's Procuratorate, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange, will establish a working coordination mechanism."

Document No. 42 innovatively implements a dual-leadership system, clearly dividing regulatory responsibilities into two lines:

1. Regulation of Virtual Currencies: "The People's Bank of China, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the State Financial Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange, will establish a sound working mechanism."

2. RWA Regulation: A sound working mechanism will be established by the China Securities Regulatory Commission in conjunction with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the Financial Regulatory Commission, and the State Administration of Foreign Exchange.

Key conclusions:

1. Previously, issues arising from inadequate coordination among multiple departments have been resolved due to clear overarching laws and accountability mechanisms, leaving no room for shirking responsibility or negligence.

2. Market entities intending to explore related businesses can clearly understand the government's power list and scope of responsibilities, reducing business misjudgments.

(7) Strengthening the responsibility of departments at the local level

Based on the Announcement of September 24, Document No. 42 adds that "specifically, the local financial management departments will take the lead, with the participation of the branches and agencies of the State Council's financial management departments, as well as the telecommunications authorities, public security departments, market supervision departments, etc., and in coordination with the cyberspace administration, people's courts, and people's procuratorates," clarifying the leading departments and cooperation mechanisms at the local implementation level, and further strengthening the local regulatory responsibility.

(8) Strengthening the management of financial institutions

(9) Expanded regulation of intermediary and technology service institutions

The regulatory scope of Announcement 924 only covered virtual currency-related services. Circular 42 added: " Intermediary institutions and information technology service institutions shall not provide intermediary, technical, or other services for real-world asset tokenization-related businesses and related financial products without consent ," officially expanding the regulatory scope to intermediaries and technology service providers in the RWA field.

(10) Market entity registration management is tightened

(11) The policy of cracking down on mining has been strengthened.

The 924 announcement only mentioned "achieving full-chain tracking and real-time information backup for virtual currency 'mining,' trading, and exchange," while Document No. 42 separately lists Article 9, which details the regulations and explicitly states that "mining machine manufacturers are strictly prohibited from providing 'mining machine' sales and other services within the country ," thus cutting off the mining industry chain at its source. Compared to the monitoring requirements of the 924 announcement, the new regulations are stricter, more enforceable, and clarify the handling mechanism for relevant departments after receiving clues.

(12) Innovation in the supervision of overseas issuance

Document No. 42 , in light of new developments in the overseas encryption field, introduces two new prohibitions on overseas issuance for cross-border businesses:

1. Without the approval of relevant authorities in accordance with laws and regulations, domestic entities and their controlled overseas entities are prohibited from issuing virtual currencies overseas.

2. Regarding RWA: "Domestic entities that directly or indirectly conduct real-world asset tokenization business in the form of foreign debt overseas, or conduct asset securitization-like or equity-based real-world asset tokenization business overseas based on domestic asset ownership, income rights, etc., should be strictly regulated by the National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments according to their respective responsibilities and in accordance with laws and regulations, following the principle of 'same business, same risk, same rules'."

Key conclusion: Combining the above clauses, it can be clearly stated that...

1. Non-RWA type offshore cryptocurrency issuance without underlying assets – illegal.

2. Tokenization of securities similar to foreign debt, equity, and ABS – legal under strict regulation

3. Regulatory principles for legitimate RWAs – referencing the securities business principle of "same business, same risk, same rules".

(13) The supervision of overseas business of domestic financial institutions has been strengthened and the responsibilities have been clarified.

Circular 42 adds: "Overseas subsidiaries and branches of domestic financial institutions shall act prudently and legally when providing services related to the tokenization of real-world assets overseas, and shall be equipped with professional personnel and systems to effectively prevent business risks, strictly implement requirements such as customer access, suitability management, and anti-money laundering, and incorporate them into the compliance and risk control management system of domestic financial institutions," thereby achieving penetrating supervision of cross-border business.

Key conclusion: Combining the above clauses, it can be clearly stated that...

1. Overseas branches (offices, sub-offices, etc.) of domestic financial institutions can conduct tokenization-related business.

2. Overseas branches conducting tokenization business must comply with both local laws and Chinese regulatory requirements, and fulfill legal obligations such as high prudence and anti-money laundering.

3. Business information and data of overseas branches must be fully integrated into the compliance and risk control system of domestic financial institutions.

(14) Regulatory coverage of cross-border services provided by intermediary agencies

Circular 42 adds: "Intermediary institutions and information technology service institutions that provide services for domestic entities to directly or indirectly conduct real-world asset tokenization business in the form of foreign debt overseas, or to conduct real-world asset tokenization related business overseas based on domestic equity, shall strictly abide by the provisions of laws and regulations, establish and improve relevant compliance internal control systems in accordance with relevant normative requirements, strengthen business and risk management, and report or file relevant business operations with relevant management departments for approval or filing ," thus formally bringing intermediary institutions providing cross-border services under the regulatory scope.

Key conclusion: Combining the above clauses, it can be clearly stated that...

1. Law firms, technology companies, and other intermediaries may provide tokenization-related services within the scope of regulatory control.

2. Intermediary institutions conducting tokenization business must have a sound risk control and internal control system, and their business operations must be reported to or approved by the regulatory authorities.

(15) The scope of legal liability subjects has been expanded.

(16) Optimization of Civil Liability Clauses

Announcement No. 924 stipulates that "any legal person, unincorporated organization, or natural person investing in virtual currencies and related derivatives that violates public order and good morals shall have their related civil legal acts invalid." Document No. 42 is revised to state that " any unit or individual investing in virtual currencies, real-world asset tokens, and related financial products that violates public order and good morals shall have their related civil legal acts invalid ," expanding the investment targets from "virtual currencies and related derivatives" to " virtual currencies, real-world asset tokens, and related financial products ," thus providing more comprehensive regulatory coverage.

Key conclusion: Any investment schemes that raise funds from domestic investors under the name of RWA are not protected by law.

III. Current Status and Future Trends of RWA Business

The concept and projects of RWA originated overseas, similar to the early STO concept, but with a broader scope, leading the industry to call it "RWA for everything." Discussions about RWA in China gradually heated up from 2024, reaching their peak between June and August 2025. This trend is closely related to the entry of large domestic institutions such as Ant Financial, JD.com, and Guotai Junan Securities, as well as the upgrading of crypto regulations in the United States and Hong Kong, the introduction of stablecoin regulations, and the continued issuance of crypto licenses.

Currently, the mainstream RWA projects and underlying assets on the market

1. Emerging operating cash flow assets such as new energy and computing power

2. Traditional operating assets such as commercial leases

3. Cultural IP Value-Added Consumer Products Projects

4. Tangible assets such as real estate, antiques, works of art, and mineral resources.

5. Other types of assets

Mainstream RWA financing solutions among practitioners

1. In countries and regions with clear regulatory rules, issuing security tokens for the aforementioned types 1 and 2 assets is completely legal, but it involves the highest regulatory requirements and the most complex operational costs.

2. Issuance of the aforementioned three types of assets and NFTs on domestic cultural exchange exchanges, digital exchange exchanges, and industrial exchange exchanges—the regulatory requirements are relatively low, and it has not been explicitly identified as illegal.

3. On overseas centralized and decentralized exchanges, token projects that issue tokens for the aforementioned asset types 4 and 5 without cash flow support—seemingly possessing underlying assets but actually constituting high-risk activities of pyramid schemes, speculation, fundraising, and market manipulation —are not yet precisely defined in legal provisions.

Due to significant differences in the characteristics of underlying assets, fundraising targets, operational norms, and project values, the RWA (Real Money Exploitation) sector exhibits numerous borderline practices, and some practitioners deliberately blur regulatory boundaries. Without strict oversight, this could easily lead to a situation where bad money drives out good, resulting in frequent high-risk projects and mass fraud incidents. Currently, the sector is comprised of a diverse range of participants, including domestic and international securities institutions, issuance service providers, overseas exchanges, digital brokers, data service providers, and mainland property rights exchanges.

But with the release of Document No. 42 , everything changed. A careful analysis of its wording reveals the regulatory authorities' thinking and philosophy:

1. Legislators comprehensively considered the laws and regulations of the United States, Europe, Hong Kong, and other regions, referencing them in terms of regulatory procedures and wording, thus achieving an appropriate alignment with international regulations.

2. The new regulations comprehensively cover emerging fields such as stablecoins and RWA , while also filling in previously ambiguous regulatory areas such as mining machine sales and mining enforcement.

3. In areas where technology is not mature enough and the power to set the rules is not yet in control, the regulatory stance is one of clear blocking to prevent financial risks.

4. For necessary alignment with overseas financing rules, especially in countries and regions with clear regulatory rules, tokenization projects implemented according to strict standards still retain a participation window for domestic financial institutions and intermediary service agencies.

Comparison Table of Core Regulatory Logic of Announcement No. 94, Announcement No. 924, and Document No. 42

IV. China Securities Regulatory Commission: What administrative licenses are required for the RWA project?

As the regulatory body in charge of RWA business, the China Securities Regulatory Commission (CSRC) issued Announcement No. 1 of 2026, "Regulatory Guidelines on the Issuance of Asset-Backed Securities Tokens Overseas by Domestic Assets," at the same time.

The guidelines explicitly state:

1. Domestic assets issuing asset-backed securities tokens overseas must strictly comply with laws, administrative regulations, and relevant policies concerning cross-border investment, foreign exchange management, network and data security , and fulfill the approval, filing, or security review procedures required by the aforementioned regulatory authorities.

2. Business operations shall not be conducted if the underlying assets or the domestic entity that actually controls the assets fall under any of the following circumstances:

(i) Financing through the capital market is expressly prohibited by laws, administrative regulations, or relevant national provisions;

(ii) Where, after review and determination by the relevant competent department of the State Council in accordance with the law, the issuance of asset-backed securities tokens overseas may endanger national security;

(iii) If the domestic entity or its controlling shareholder or actual controller has committed any criminal offenses such as embezzlement, bribery, misappropriation of property, or disruption of the socialist market economy order within the past three years;

(iv) The domestic entity is under investigation for suspected crimes or serious violations of laws and regulations, and no clear conclusion has been reached yet;

(v) The underlying assets are subject to significant ownership disputes, or the assets are legally prohibited from being transferred;

(vi) The underlying assets are subject to the prohibitions stipulated in the negative list of underlying assets for domestic asset securitization business.

3. Before commencing any related business, RWA's project team needs to submit a filing report to the China Securities Regulatory Commission (CSRC), along with a complete set of overseas issuance documents, fully explaining the information of the domestic filing entity, underlying assets, and token issuance plan. Once the CSRC filing is completed, the filing information will be published on the CSRC website. [Important: For projects that use domestic assets or revenue rights for tokenized financing overseas, obtaining this CSRC filing is considered a legal project.]

In addition, for RWA projects that have been issued, the China Securities Regulatory Commission (CSRC) will also implement in-process management, continuous supervision and information exchange with overseas institutions during their operation.

Sha Lu believes that with the release of the aforementioned documents, RWA, this novel concept, has finally been vindicated and has returned to the logic of security token issuance and regulation. Although more detailed rules have not yet been released, the regulatory gray areas surrounding RWA and stablecoins over the past three years have been fully explored. Through legislative protection, regulation now has a handle, and practitioners have guidance.

Special Note: This article is an original work by the CryptoShaLaw team and represents only the author's personal views. It does not constitute legal advice or counsel on any specific matter. For reprint authorization, please contact shajunlvshi via private message.