China's initiative to tokenize revenue rights on real assets (RWA) represents a significant step forward in financial regulation and innovation. New projects like Longshine Technology are opening new approaches to financing, facilitating access to capital for small and medium enterprises.
New Tokenization Architecture
Longshine Technology is tokenizing revenue rights on 9,000 charging stations in Hong Kong, raising 100 million yuan in a sandbox testing mode using an innovative compliance scheme. This architecture reduces financing costs for real assets from 8.7% to 5.2%.
Asset Segmentation: Industry vs Agriculture
China's RWA practice demonstrates two approaches: the tokenization of assets such as charging stations and the localized packaging of agricultural data. Longshine employs physical revenue rights as the basis for the token, while the Malu project separates revenue rights into a shareholding structure and does not allow tokens to circulate freely.
Advantages and Challenges for RWA in China
Current tokenization models reveal both opportunities and challenges for the market. Longshine utilizes innovations to overcome barriers, while Malu faces stringent regulatory constraints. Furthermore, the issue of asset stability and technical compatibility remains critical, especially for agricultural products.
Innovations in real asset tokenization in China open new horizons for financing; however, paths to success lie in adapting to regulatory requirements and optimizing assets, which requires further study and implementation.