Exclusive-China asks brokers to pause real-world asset business in Hong Kong, sources say

Core Viewpoint - China's securities regulator has advised local brokerages to pause their real-world asset (RWA) tokenisation business in Hong Kong, indicating concerns over the rapid growth of the digital assets market offshore [1][2]. Group 1: Regulatory Guidance - The China Securities Regulatory Commission (CSRC) has provided informal guidance to at least two leading brokerages to refrain from conducting RWA business offshore [2][6]. - The regulatory guidance aims to enhance risk management in the new business and ensure that companies' claims are supported by legitimate businesses [3][4]. Group 2: Market Context - The RWA tokenisation process involves converting traditional assets like stocks, bonds, and real estate into digital tokens on a blockchain [2]. - The global RWA market is valued at approximately $29 billion, with projections suggesting it could exceed $2 trillion by 2030 [5]. Group 3: Hong Kong's Position - Hong Kong has been working to establish itself as a digital assets hub, with various firms, including Chinese brokerages, preparing for virtual asset trading and management [3][5]. - The Hong Kong Financial Services and the Treasury Bureau (FSTB) and the Hong Kong Monetary Authority (HKMA) are reviewing the legal framework for RWA tokenisation, drawing on international experiences [5].