China is increasingly embracing specific use cases for digital assets and blockchain technology.
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- China's state-owned enterprise Huichian investment holdings issued its first RWA bond
- Ethereum-based bonds allow investors to purchase the company's debts
- China has complex relationships with digital assets
Real world assets come to China in major ways. On Monday, September 1st, China's state-owned enterprise Futian Investment Holding announced the issuance of its first RWA offering for digital bonds.
The deal dated August 29th saw offshore bonds held in Shenzhen-based Hong Kong valued at 500 million yuan. Bonds issued on the Ethereum (ETH) blockchain have a two-year expiration date and an interest rate of 2.62%.
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The move, according to the company, was a response to growth trends in tokenization and adoption of RWA technology. Part of the motivation was to show that the company was taking a forward-looking approach to new technologies.
“This move will not only help businesses expand their global funding channels and optimize their capital structure, but will fully utilize Hong Kong's policy dividends and inject the momentum of solid state-owned enterprises into high-quality developments in the Futian district,” the company wrote.
It is important to note that RWA bonds are traditional financial equipment currently available on the blockchain. In this sense, it does not constitute a broader embrace of China's digital assets.
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The complex relationship between China and cryptography
China has a complex relationship with cryptography. In 2021, China implemented a complete ban on all crypto trading and mining. The main reasons for the ban were its impact on energy demand and concerns that crypto could destabilize the financial system.
Still, the country continues to allow certain use cases of digital assets and blockchain technology. Recently, China, like many other countries, is worried about the growing popularity of stubcoins. In particular, stubcoins, dominated by dollars, currently dominates the market, and could have a negative impact on other currencies.
read more: China, Japan and other countries challenge the Stablecoins Crusades on USD Page
