China’s latest regulatory statement on RMB stablecoins and real world asset tokenization has reinforced long standing domestic restrictions, but it stops short of imposing a blanket offshore ban. Issued on February 6 by the People’s Bank of China alongside the China Securities Regulatory Commission and six other agencies, the notice reiterates that issuing RMB pegged stablecoins or conducting RWA tokenization remains illegal on the mainland. At the same time, it clarifies that offshore activities may still be possible under tightly controlled conditions.
The regulators framed their position around three core concerns. First, they highlighted gaps in customer identification and anti money laundering compliance, arguing that many stablecoin models fail to meet China’s strict standards. Second, they pointed to the borderless nature of stablecoins, which clashes with the country’s capital controls and its ability to manage cross border flows. Third, and most importantly, they emphasized the perceived threat to monetary sovereignty posed by privately issued digital representations of the renminbi.
The statement includes a firm prohibition that applies both domestically and internationally. Without approval from the relevant authorities under Chinese law, no organization or individual, whether based inside or outside China, may issue a stablecoin pegged to the RMB. This language has been widely interpreted as closing loopholes that might allow Chinese firms to issue RMB stablecoins overseas without oversight. However, the wording also leaves room for regulatory coordination with foreign jurisdictions.
That nuance matters, particularly in the context of Hong Kong. The city has been developing a comprehensive stablecoin framework and is expected to issue its first licenses in March. Under the current proposal, every stablecoin holder must be fully identified at all times, an unusually strict requirement by global standards. While this approach may evolve for other currencies, it could remain a permanent condition for any RMB linked stablecoin. With coordination between Hong Kong regulators and mainland authorities, a narrowly defined offshore model could emerge.
The same logic applies to the tokenization of real world assets. The notice confirms that onshore tokenization activities are prohibited, but it does not outlaw offshore tokenization carried out by entities that have received proper authorization from their local regulators. Chinese companies seeking to tokenize assets abroad would still face enhanced scrutiny, and their financial and technology partners would be expected to meet elevated compliance standards.
Taken together, the policy signals continuity rather than escalation. China is not softening its stance on private digital representations of its currency, nor is it embracing onshore RWA tokenization. But it is acknowledging that these activities exist globally and may proceed outside its borders under carefully supervised arrangements.
For market participants, the message is clear. There is no near term path for RMB stablecoins or tokenized assets inside mainland China. Any offshore experimentation will depend on close regulatory coordination and strict compliance, particularly where monetary sovereignty is concerned.
