Regulatory realignment with a shifting regulator lineup. The 2026 Notice reaffirms the strict prohibitory stance against any cryptocurrency-related activities within China as seen in the 2021 Circular. However, the regulatory structure is adjusted compared to the 2021 Circular. Most notably, the 2026 Notice does not include as co-issuers party organs (the Central Cyberspace Affairs Commission) and the judiciary (the Supreme People's Court and the Supreme People's Procuratorate). NDRC, as the PRC's top macroeconomic management and planning agency, is included as a co-issuer, with a view toward regulating RWA tokenization products that operate as debt finance tools.

In this case, the issuing authorities of the 2026 Notice are all under the State Council, indicating that its scope has shifted from general policies to detailed regulatory guidelines. The newly added penalties further signify that the 2026 Notice will be a regulator-led, full-fledged regulation with "teeth" allowing for enforcement actions.

Currency-based jurisdiction over stablecoins. Stablecoins remain categorized as strictly prohibited cryptocurrencies. The 2026 Notice emphasizes that, because stablecoins perform the functions of legal tender, no onshore or offshore entity is permitted to issue a CNY-pegged stablecoin without explicit approval from relevant PRC authorities.

Distinct classification of "foreign debt" and "securitization" RWA tokens. For the first time, the 2026 Notice explicitly places RWA tokenization under a separate regulatory framework from those governing traditional, speculative cryptocurrencies such as Bitcoin.

The 2026 Notice clarifies that RWA tokens (i) backed by onshore proprietary rights, rights to proceeds, and other onshore rights; (ii) offered overseas; and (iii) which operate as equity interests or debt financing tools are now regulated by CSRC, NDRC, and SAFE under their respective rules governing securitization or debt finance. For these RWA tokens, it is noteworthy that PRC regulators adopted the principles of "same business, same risks, same rules"; such principles are also shared by the Securities and Futures Commission of Hong Kong as its regulatory philosophy over RWA tokens.

Expanded restrictions on offshore entities. The 2026 Notice further expands the scope of restrictions on cryptocurrency/RWA token issuers and the products. Under the 2026 Notice, offshore entities and individuals are now broadly prohibited from providing virtual currency-related services to domestic entities in any form, expanding the restriction beyond the onshore employees or affiliates of such offshore entities.

This expanded restriction over offshore entities has similarities to the "effect" test found in many U.S. laws, which gives U.S. federal courts jurisdiction over behaviors that have effects in the United States. As such, the 2026 Notice may, in effect, empower PRC regulators to take actions against purely offshore entities that offer cryptocurrency/RWA tokens to PRC entities. Foreign entities should prudently monitor the latest enforcement developments and trends to avoid becoming regulatory targets of onshore regulators.

Restrictions on onshore entities' overseas RWA token issuances. Onshore entities and their offshore subsidiaries are strictly prohibited from issuing RWA tokens backed by domestic assets in overseas markets without prior regulatory consent or filing with CSRC. With regard to the RWA approval criteria, CSRC has issued the Regulatory Guidelines on the Offshore Issuance of Asset-Backed Securities Tokens Backed by Onshore Assets (the "CSRC Guidelines") following the publication of the 2026 Notice.

The CSRC Guidelines, on top of establishing a filing-based system for RWA tokenization, have mandated strict compliance with national regulations regarding cross-border investment, foreign exchange, and data security, while explicitly prohibiting the use of assets linked to national security risks or those involved in legal disputes. By distinguishing tokenized securities from prohibited cryptocurrency-related activities, CSRC aims to bring offshore RWA tokenization activities by onshore entities into a regulated framework that is aligned with general securitization transactions, prevents speculative bubbles, and safeguards national interests.

Notwithstanding the above, detailed filling requirements are yet to be further clarified by CSRC. It is expected that CSRC will impose relatively stringent requirements on the applications at the initial stage. Nevertheless, the CSRC Guidelines have paved the way for the long-term compliance framework of RWA tokenization.

Enhanced institutional and online information management. The 2026 Notice has also strengthened the regulation of onshore financial, intermediary, and technical service providers. In addition to a general ban on issuing cryptocurrency/RWA-based financial products, such service providers are explicitly forbidden from offering or accepting cryptocurrency/RWA tokens, or their related financial products, as collateral or guarantees, or subjects of insurance policies.

Additionally, internet platforms, including social media platforms and public account platforms, are required to ban accounts that "provide online business space, commercial display, marketing and promotion, paid traffic redirection and advertisements" of cryptocurrency/RWA token trading activities. Therefore, the traditional promotion model via offshore key opinion leaders' onshore social media accounts may face heightened risks of account ban and other restrictions.