China’s Enduring Crypto Stance: A Reality Check for Businesses
Since 2021, China’s comprehensive ban on cryptocurrency activities has remained firmly in place. Despite this, some companies continue to explore perceived opportunities, particularly those involving Hong Kong and international markets. These efforts, however, frequently encounter swift and decisive responses from Beijing, underscoring the unlikelihood of a policy reversal.
Hong Kong: A Dubious Gateway
Recent narratives have suggested Hong Kong could offer a pathway for crypto businesses. Announcements regarding stablecoins and discussions around real-world asset (RWA) ventures have fueled speculation. However, authorities in mainland China have consistently pushed back against such developments.
Reports indicate that the China Securities Regulatory Commission has advised companies to put a hold on RWA projects within Hong Kong. This guidance followed instances where state-owned entities retracted announcements related to tokenized bonds and other enterprises revealed RWA initiatives. These incidents further align with prior warnings concerning stablecoins, arriving shortly after Hong Kong introduced its own licensing framework for digital assets.
International Ventures Also Face Scrutiny
Beyond Hong Kong, some businesses have sought to leverage overseas listings or other international strategies that subtly reference digital assets. These attempts to navigate around the ban have also been met with clear indications from Chinese regulators that any engagement with cryptocurrency, even indirectly, is not permissible.
Legal experts, such as Joshua Chu, have highlighted that these perceived ‘loopholes’ are often illusory. Chu suggests that attempts to circumvent the ban invariably lead to increased scrutiny and potential enforcement actions. The consistent messaging from Beijing serves as a reminder that the prohibition on crypto remains a core policy, with no indication of a swift change in direction.
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