Regulation of RWA and Traditional Financial Markets from a Fin-tech Perspective:A Study on Domestic and Overseas Compliance Pilots

DOI: https://doi.org/10.62517/jel.202614513

Author(s)

Zhanzhan Wang

Affiliation(s)

Business School, University College Dublin (Singapore Campus), Fintech, Singapore, Singapore

Abstract

As the tokenization of global real world assets (RWA) expands rapidly,its cross market,cross industry,and cross technology characteristics have brought about complex risks and regulatory challenges. RWA tokenization serves as a key bridge connecting traditional finance (TradFi) and decentralized finance (DeFi),referring to the process of mapping real assets such as real estate,bonds,commodities,and intellectual property onto the blockchain as digital tokens that are tradable,divisible,and combinable on the chain. Based on the background of financial digitalization,this article systematically examines the development motivations of RWA and analyzes the main risks involved:legal compliance(ownership confirmation,cross border regulatory conflicts),technical risks(smart contract vulnerabilities),market risks(liquidity,price manipulation),and operational risks(asset custody,cash flow disruption). Based on the case studies of global compliance pilots such as those in Hong Kong,Singapore,the United States,and the European Union(EU),combined with the comparison of compliance pilots,regulatory technology and compliance analysis,a suitable path for China is proposed. A framework of “compliance first on the chain below,controllable technology on the chain above,and coordinated supervision” is constructed. Measures such as pilot regulatory sandbox,unified compliance standards,and complete technical infrastructure are implemented. Clear asset rights and message disclosure standards are established,the custody and auditing mechanisms are improved,cross border supervision coordination is strengthened,and RWA promotes the high quality development of the real economy. The findings of this study indicate that traditional regulatory models are no longer adequate for the standardized development of RWA,making regulatory coordination a core requirement. Overseas markets primarily focus on categorized planning,sandbox trials,and technology driven empowerment. There are significant differences between domestic and international regulations:foreign regulators emphasize innovation,inclusiveness,and market oriented operations,while domestic authorities adhere to the principles of “licensed financial activities,controllable risks,and serving the real economy”,implementing a strategy of “strict oversight within the country,pilot programs abroad,and cross border coordination”.

Keywords

RWA; Domestic and Overseas Compliance Pilot Program; Regulatory Sandbox; Legal Compliance

References

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