Author: Liang Yu, Zhao Qirui
Editor: Zhao Yidan
Hong Kong's window, the global stage. In 2025, the heat of RWA (Real World Asset Tokenization) continues to rise in Hong Kong. From photovoltaic power plants to computing power assets, more and more mainland enterprises are choosing to explore this new path in Hong Kong.
The support from policies is evident: Hong Kong's "Stablecoin Ordinance" has been officially implemented, the "Digital Asset Development Policy Declaration 2.0" clarifies the regulatory direction, and the Monetary Authority and the Securities and Futures Commission are attempting to provide a pilot environment for the market through the Ensemble FinTech Sandbox. However, RWA is not an easy ticket; it is a difficult voyage. Unlike traditional financing, it requires enterprises to "pass through" compliance, technology, and capital markets simultaneously. Any delay in any link may cause the entire project to come to a standstill.
At the same time, this is not an experiment exclusive to Hong Kong.
The Monetary Authority of Singapore (MAS) has promoted Project Guardian, which has taken exploratory steps in the tokenization of cross-border bonds and foreign exchange; in the United States, BlackRock and JPMorgan are continuously increasing their investments in tokenized funds and settlement networks; the EU's MiCA framework is gradually providing a unified compliance baseline for RWA. Hong Kong's uniqueness lies in its backing of a vast asset pool from the mainland while facing the capital flow from international investors, making it a "frontier testing ground," which also means a dual test.
The ledger beneath the iceberg: Starting costs and preparations of 3 million
On the surface, RWA seems like a simple task of "putting assets on the chain and finding investors"; however, when it comes to implementation, a bill of 3 to 6 million RMB often awaits. The technical aspects require the deployment of blockchain, integration with IoT, completion of smart contract development, and third-party audits. According to research from Dentons, even with standardized solutions like Ant Chain, the development and maintenance costs still amount to approximately 800,000 to 1.2 million RMB.
Compliance costs follow closely behind. Dual audits from domestic and foreign entities, cross-border legal opinions, and data exit filings constitute the "invisible expenses" that enterprises must face. Observations from Liu Lei's legal team indicate that the initial costs for RWA issuance, including lawyers, audits, and custody, range from 3 to 5 million HKD. If brokerage underwriting commissions are included, the actual costs are even higher. Industry insiders generally estimate that the fees for the Big Four audit reports range from 300,000 to 500,000 RMB, cross-border legal opinions about 400,000 to 600,000 RMB, and the approval cycle for data exit security assessments often takes 45 to 60 working days; if not approved, a three-month wait is required for reapplication.
The heaviest burden lies in brokerage and channel fees: licensed brokers control the key links of underwriting, fundraising, and listing, with fees commonly ranging from 2 to 3 million RMB; if funds are repatriated through QFLP or QDLP, an additional channel fee of about 1% of the fundraising amount must be paid; if large institutions like sovereign funds are involved, fundraising costs may increase by another 2% to 5%.
Using regional comparisons as a reference, the standards also need updating. Singapore has implemented the DTSP (Digital Token Service Providers) framework under Section 9 of the Financial Services and Markets Act 2022 (FSMA), which requires companies established or operating in Singapore and providing digital token services to overseas clients to be licensed starting from June 30, 2025. Research from Dentons shows that the approval standards for this framework are tightening rather than "faster and looser," indicating that the "efficiency gap" between regions is narrowing. Hong Kong's unique advantage still lies in its backing of mainland assets and bilingual legal ecology, but to secure this position, enterprises must incur tangible time and financial costs.
From trial to normalization: Investment and preparation of licenses, manpower, and time
The collaboration between Cao Cao Mobility and Victory Securities revolves around three levels, building a complete digital financial ecosystem. Treating RWA as a one-time experiment and incorporating it into the enterprise's regular financing tools are two completely different paths. The former is a point-based attempt, while the latter is a systematic project. The complete process often takes 18 to 24 months: asset selection and confirmation take 1 to 3 months, cross-border structure and SPV establishment take 2 to 4 months, technical on-chain processes take 3 to 6 months, obtaining Hong Kong licenses and sandbox testing take 6 to 12 months, and issuance and fund repatriation take about 1 to 2 months.
Regulatory requirements determine the foundational posture of "licensed operation." License 1 (securities trading), License 7 (automated trading), and License 9 (asset management) are the main licenses for engaging in securities token business. The cost of applying for a single license generally exceeds 1.5 million HKD and requires a paid-in capital of no less than 5 million HKD, the appointment of a licensed responsible officer (RO) with over five years of regulatory experience, and the establishment of a comprehensive AML/KYC system. If the business touches on the category of virtual asset service providers (VASP), the overall investment can rise to tens of millions.
At the industry level, the landscape of cooperation is also adjusting. Guotai Junan International has partnered with Ant Group to further integrate "traditional brokerage + technology platform"; other institutions are exploring collaborative paths with virtual asset platforms, such as HashKey and GF Securities' attempts in tokenization and market-making services, demonstrating the diverse coupling of brokers and FinTech. Regardless of how the paths diverge, what truly determines success or failure is whether enterprises possess the composite capabilities across legal, accounting, and technology fields, as well as the patience for long-term investment.
Green lights and red lights: A strict asset checklist
Dentons has proposed three categories of asset standards: "Green Light - Yellow Light - Red Light," which have almost become the "unwritten rules" of the industry in practice.
Green light assets emphasize clear ownership and stable cash flow, such as photovoltaic and wind power plants that must provide nearly a year of power generation data and pass green finance certification; charging stations must connect to IoT to interface with real-time electricity data from the national grid and pass sandbox cash flow tests; cross-border receivables from state-owned or central enterprises commonly have an annual yield threshold around 6%; technology patents must have PCT certification and demonstrate stable licensing fees; the traffic flow prediction model for toll roads must control errors within 5%. Yellow light assets, such as rental income rights for core business district Grade A office buildings, bulk commodity contracts, and appraised cultural relics, require thicker risk buffers and additional disclosures due to higher valuation, liquidity, or regulatory uncertainties.
As for the red light category, the early market broadly categorized "residential income rights, non-anonymized data, virtual currency derivatives, and legally prohibited circulation items" as high-risk or prohibited items. However, recent exploratory trading structures for residential income rights have emerged in the market, reminding us to maintain a dynamic and layered management perspective on "red lights": it is not a "one-size-fits-all" prohibition but requires structured modifications within strict compliance boundaries, such as separating land ownership, setting up rent supervision accounts, enhancing information disclosure and investor suitability, and maintaining real-time communication with regulators.
Technology and sandbox: The threshold on the chain
On the technical level, Hong Kong and the mainland adopt a "dual-chain parallel" architecture. Domestic assets are usually anchored on alliance chains like Ant Chain or BSN, storing data hashes and IoT real-time data, and must pass ISO 27001 information security certification. Overseas, standards like ERC-3643 or ERC-1400 are used for securities tokens to meet SFC compliance requirements.
To ensure that on-chain data synchronizes with real-world assets, it is often necessary to integrate Chainlink oracles to synchronize external data such as electricity prices and commodity prices in real-time, avoiding disconnection between token value and cash flow. All smart contracts must undergo third-party audits and are subject to random checks by the SFC.
Even so, Hong Kong's Ensemble sandbox remains highly demanding. Data from Q1 2024 shows a pass rate of only 17%, with 73% of rejected projects stuck on mainland compliance issues—either due to incomplete confirmation documents or unfiled data exits. The strictness of the sandbox is not only a necessity for risk control but also a direct test of the enterprise's compliance capabilities.
Who will take over this digital bond?
On the other end of RWA is the choice of capital. Who is willing to pay determines whether this game can go far.
In the international market, sovereign wealth funds are the most steadfast players. Singapore's GIC and the Middle East's ADIA tend to allocate RWA in green energy and infrastructure to meet both ESG and long-term return goals. The tokenized money market fund launched by BlackRock has attracted billions of dollars in inflows; JPMorgan's Onyx network is attempting to create a cross-border clearing infrastructure.
In Hong Kong, family offices and private banks are quietly entering the market. For them, photovoltaic power plants, toll roads, and cross-border receivables mean predictable cash flow and policy-backed endorsements. Temasek's participation in Singapore's green bond tokenization pilot is the best illustration of this logic.
This means that RWA is not just a new financing tool for issuers but is gradually becoming a new allocation choice for investors.
Moving forward in regulatory collaboration
The promotion of cross-border RWA is a parallel process of market innovation and regulatory adaptation.
Data exit is the first challenge. Involving personal information or critical data such as electricity and logistics, it must undergo cross-border security assessments by the National Cyberspace Administration, with approval cycles often exceeding two months. Fund repatriation relies on official channels like QFLP and QDLP, and each case must be reported. Any single dividend exceeding 5 million USD must be filed in the foreign exchange bureau system. On the tax front, when an overseas SPV distributes dividends to the mainland, it can enjoy the China-Hong Kong tax treaty, reducing the withholding tax on dividends from 20% to 5%, but must provide proof of residency issued by the Hong Kong tax authority.
These multiple requirements mean that enterprises must respond to the scrutiny of the Hong Kong SFC while simultaneously filing with the China Securities Regulatory Commission, the Cyberspace Administration, the State Administration of Foreign Exchange, and the National Development and Reform Commission. Any slight oversight can delay the entire process. Therefore, RWA is not only an enterprise's risk but also a testing ground for regulation. In the future, this cross-border coordination may even compel regulators to introduce new "data sandboxes" and green finance channels.
From ABS to RWA: Historical echoes and future directions
Risk has never been far away. RWA tokens may be discounted due to insufficient liquidity, cross-chain bridges and smart contracts face technical risks of being attacked, and the boundaries and speed of regulatory policies are also dynamically changing.
However, if we extend the timeline, RWA easily evokes memories of asset securitization (ABS) from twenty years ago and more recent REITs: early high costs and small-scale pilots, mid-term standardization of tools and maturity of information disclosure systems, and long-term trends toward normalization, scaling, and transparency.
Whether RWA will replicate this trajectory, no one can provide a guaranteed answer, but it is certain that the degree of collaboration among compliance, technology, and capital will determine whether it can cross the "early expensive phase" and reach the "institutionalized inclusive phase."
The game of long-termism
RWA is not the answer for all enterprises. It is more suitable for those with high-quality assets, strong compliance awareness, and international strategic intentions. In the short term, enterprises must be prepared to bear high upfront costs and a process lasting up to two years; in the long term, it may become the new norm for cross-border financing, even reshaping the interaction between mainland capital and international markets.
This is a game of capital, compliance, and technology, as well as a two-way adaptation between regulation and the market. For true long-termists, RWA is not a shortcut to quick financing but a ticket to enter the global capital market.
Amidst the fog and high walls, it is an expensive ship. But for those daring to set sail, it may point to the next sea of finance.
Data source note:
To ensure data accuracy and rigorous viewpoints, the cost estimates, process cycles, regulatory standards, and other information involved in this article are primarily based on the following authoritative materials:
1. Dentons, "Dentons Research | Wang Jie et al.: Compliance Operation Guide for Mainland Listed Companies Issuing Tokenized Securities (RWA) in Hong Kong"
2. Liu Lei's legal team, "A Letter to Enterprises in Mainland China Hopeful to Go to Hong Kong for RWA," published on the "Legal Dynamics in the Cryptocurrency Circle" public account
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