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AI Token Skyrockets: Comprehensive Overview of the Next Potential Breakout in Crypto AI
In October 2024, since the launch of the AI Meme—GOAT, the AI Agent concept, Crypto has begun to accelerate its integration with AI. Concepts such as Game+AI, DeFAI, AI Agent Hive, etc., have sprung up, with almost a new batch of concept projects appearing every week, until January 18th of this year when Trump announced the issuance of MemeCoin, directly draining market liquidity, causing the premature bursting of the CryptoAI bubble. Two days later, DeepSeek announced the open-source R1 model, and after several weeks of fermentation, the AI concept stocks in the US stock market also saw their bubble burst.
With just $6 million, one could create a large model; however, those holding out for the $60 million market cap of CryptoAI were once defined by the community as "undereducated cabbage." Such trends were rampant, coupled with the collective plunge of AI concept stocks in the US market, naturally causing the coin price to spiral downwards, leading to the gradual silence of the AI concept in Crypto.
One quarter later, the CryptoAI uproar returned to the market, and this time, it seemed to bring some new concepts.
Different Facets of AI Ecosystem Coin Issuance Platforms
Following Pumpfun's success story, Crypto sparked a trend of asset issuance platforms. During the previous AI Agent craze, frameworks and AI distribution networks/LaunchPads were the two highest FDV areas. However, after the concept of framework akin to Ai16z's developer community had developed to a certain extent, the community realized the limited capabilities of frameworks, especially in capturing the value layer in Crypto. Thus, the existing frameworks gradually transitioned into LaunchPads. However, AI LaunchPads also faced challenges because the existing LaunchPads could not meet the needs of AI product launches. In preparation for the next wave of AI resurgence, project teams began looking for solutions.
The Sanctuary of CryptoAI Infrastructure—Bittensor
Despite experiencing a recent incident where the SN28 subnet was exploited to turn it into a MemeCoin and drive TAO into Meme Coin hype, ultimately being centrally intervened by the foundation, over time, the foundation's control over the Bittensor subnet will diminish. This has sparked community concerns about its future potential to become a "attention network" pan-incentive project. A longtime follower of the Bittensor project, known as "Quirky Mind," also published an article stating that this could be a scam.
Further Reading: "Opinion: Why Bittensor Is a Scam and TAO Is Heading to Zero?"
However, purely from an investment perspective, Bittensor's ecosystem liquidity is better than that of other AI Agent ecosystems. For example, Virtuals, because LP and Virtuals are paired, this will lead to higher volatility for liquidity providers. There is approximately a 3% to 7% slippage when investors invest in agent tokens within the platform. When funds are invested in dTAO subnet tokens, the slippage is usually 0.05% to 0.1%.
It is for this reason that VC or large AI project participants tend to lean towards making long-term investments in Bittensor. Just last week, former Messari analyst and Crucible Labs partner Sami Kassab announced that he and his friend Seth Bloomberg, who has similar work experience, will establish a fund specifically for providing liquidity to Bittensor.
The "First Mover" of Bittensor, Rayon Labs, has created several products that offer a glimpse into the preferences of Bittensor's project parties, who are often more "practical" and long-term oriented.
SN64 "Chutes" provides a serverless way to easily deploy AI infrastructure, with the project team stating that a previous AWS outage was a prime example of why we need "serverless." Because if reliant on centralized service providers, once an outage occurs, AI applications may crash due to a single point of failure, and the crypto industry being money-intensive, the probability of losses is much higher than traditional AI.
SN56 "Gradients" is a zero-code platform for deploying AI models, where users can train their own AI models on Gradients (for specific use cases, image generation, custom LLM), and the recently launched v3 has a competitive advantage in terms of pricing compared to similar products.
SN19 "Nineteen" is a fast, scalable, decentralized AI inference platform.
Architect of the AI Agent Protocol — Virtuals Protocol
As one of the most complete AI projects combining ecosystem building with a value flywheel in the previous cycle, Virtuals Protocol's token price has slowed along with the ecosystem's momentum as the market quieted down. Following this, the $45 billion market cap bubble was burst, experiencing a drop of over 90%, and significant decrease in participation from launchpad contributors. However, Virtuals did not give up. In this AI bear market, they began to Build.
First, Virtuals refined their own project development ecosystem by launching the VPN plan "Virtuals Partners Network." From the beginning, Virtuals' plan was to onboard more AI people into the Crypto space. This plan will interconnect multiple ecosystem positions, including investors, experts from various fields, scholars, and developers. Essentially, as long as you have an idea, resources can be obtained through this plan from investors to liquidity providers, marketers, and even professionals. This "one-stop service" incubator can be said to be the best choice for anyone looking to enter Crypto to collaborate with Virtuals.
To expand the influence and interactivity of AI Agents in the ecosystem, Virtuals has designed a protocol called ACP "Agent Commerce Protocol." It can be seen as a realization of the previous Swarm, Ai16z, and similar projects' hive concepts. ACP has built a commercial ecosystem composed of AI agents – a virtual nation where AI Agents can autonomously interact, cooperate, and transact with each other. It is worth mentioning that after this, Google also released a similar A2A concept. A slight difference is that ACP is connected by smart contracts, whereas A2A is connected by protocols.
In April, Virtuals just launched a new model of Virgen points and Genesis launch mode. Users can earn points through investing in Sentient and Prototype Agents, holding Virtuals, staking VADER, among other methods, and points serve as the basis for participating in the Genesis launchpad project. The Genesis launchpad is an IDO-style project launch method, where users receive investment quotas based on the points they hold. Currently, not everyone can participate in this launch mode, as it requires official approval from Virtuals.
This model has several benefits. First, it increases the stickiness of its platform users through rewards. In the words of founder Ethermage, "Our principle is to reward believoors." Staking points to participate in the Genesis project allocation is a fairer start, with participants usually of higher quality, allowing the project to develop more sustainably.
What was the most interesting project at the Virtuals Protocol hackathon?
In addition to the projects on Genesis worth noting, Virtuals just announced the winners of this hackathon on April 21, with more than 100 project teams participating. The judging panel was also quite impressive, including LucaCurran, who is in charge of AI and DEPIN sector development at Base, KunPeng, the founder of the Stanford Blockchain Community, and Anand Iyer, a partner at Canonical Crypto. Interestingly, Anand's Tag on X is AI.
The Intern is an AI assistant for operations. He can help with promotion, replies, and community management on X. By deep diving into the community, he can understand its culture and can generate images using TADA. He has now teamed up with Pudgypenguins to launch the Penguin Intern, running his own Twitter. From the quality of Twitter operations, if it is entirely AI-operated and can be scaled to this level, it would be a good product.
BuzzingClub is a prediction market platform where the project team believes that the future of prediction markets should be in the hands of the participants, rather than a central authority, stating that "everyone should be able to freely create, share, and express their opinions," making Buzzing more free compared to other prediction platforms.
In Buzzing, all users can create prediction markets by proposing topics or questions, with AI generating rules. Subsequently, an AI algorithm filters out some spam and low-quality prediction markets, and finally, an AI oracle automatically retrieves internet search data, rather than human-generated data, to determine the outcome of the prediction question.
Burnie is a code-learning platform that can enhance the skills of users who want to learn to code, and players can earn rewards by completing the tasks he publishes.
Inspiration as the App, Post-AI Application Era Market Layout
Arc and Ai16z, as the framework development stagnated, have also transformed into distribution platforms for AI Agents. Since the launch of the distribution platform forge by Arc, it has disappeared from the spotlight since the first product, AskJimmy. Ai16z's AutoFun went live a few days ago, but the currently publicly supported projects have not gone online, and its development path is still unknown. From a product framework perspective, AutoFun seems more inclined to create a community UGC culture platform, with little difference in value retention compared to traditional LaunchPads.
Arc plans to launch the new Agentic App Store Ryzome, while Myshell's existing AIApp Store has yet to officially launch, and the latter lacks activity, with most of the products appearing to be similar.
In this scenario, dev.fun, which previously appeared with the concept of AppFi, seems more conventional. At first glance, it looks similar to Pumpfun in everything from color scheme to UI but appears to have more vitality on some level. Although from a token price perspective, dev.fun, like other AI projects, has experienced a significant drop in this cycle. Surprisingly, there are currently nearly 13,000 Apps born on this platform.
dev.fun has provided a feature that allows users to generate apps through AI chat, similar to the previously YC-backed Replit. In addition to being able to issue project/meme tokens, users can also choose their own trading pairs. The Buidl, which currently has the most supporters, has a total of 1400 apps and has been run nearly 70,000 times.
What AI is Currently Preferred in the Crypto Market?
The currently popular projects in the market are divided into several categories. One is development tools, including frameworks, AI Coplit's programming tools, and MCP infrastructure. The second is consumer AI applications, including AI agents, games, DeFAI (Alpha signals, funds, automated LP), and GambleFAI. The third is decentralized AI infrastructure, such as decentralized computing, validation, storage, etc. The first two are usually more favored by retail investors, while the third is preferred by VCs or investors, and such projects often require a relatively high valuation to participate.
Development Tools
These projects have a broader range of use cases and project concepts, but many times they are also the preferred choice of scam project teams because to retail investors, there is no "visible" product. The feedback cycle of such products is often longer, and whether it is "usable" or can generate viral spread (someone using it) is key. Therefore, creating such products requires a high level of technical expertise and marketing skills for a team.
A recent hot project, the MCP project Dark, is one of the projects that has done both well. Launched DARK under the influence of the MTN DAO and delivered a visible game product, "Dark Forest," within two weeks.
In this field, the most widely spread project in the market right now is probably Solana's "prodigal son" SEND AI, which gained fame by hosting a large AI hackathon for Solana in the past. The Solana Agent Kit is also used in many products. ALCHEMIST AI continues to build up, dropping to a $1.4 million market cap from February, and has now returned to a $14 million market cap.
Autonome is a platform created by the Rollups protocol AltLayer that provides developers and users with the ability to build, deploy, and distribute verifiable AI agents without code. It has been active since the previous cycle and has not yet issued tokens.
Consumer Artificial Intelligence
Game
Recently, Treasure announced that it would shift the project's focus from the gaming chain and game operations to AI+NFT. Today, SMOL has provided the first response to this initiative by announcing the release of the "Virtual Companions" feature. This feature can turn NFTs into AI agents, and these agents will be able to use social media, play GameFi or DeFi on their own, and have created a marketplace for AI agents to trade skills, memories, and other data.
Community player Fairu's actual in-game screenshot
The first game to go live is the on-chain RPG game Gigaverse by Abstract. The community has generally praised it, and as a result, Treasure's token price has rebounded. After plummeting to a $20 million market cap following the previous announcement of exiting the GameFi business, today it has returned to an $80 million market cap. Besides the anticipation of the NFT AI transformation technology, the prospect of having AI agents play GameFi may be more appealing. The issues of no one playing for GameFi project teams and uninteresting games for players may potentially be solved in the future by assetized AI agents.
DeFAI
After 18 months of development, Almanak announced last week on April 17, 2025, that it will conduct the token generation event (TGE). Almanak is an end-to-end platform that allows users to create, optimize, and manage complex financial strategies using AI agents. Functions such as market data analysis, strategy formulation, optimization, and high-speed execution can all be automated. The team has received support from numerous top-tier venture capital firms and advisors, such as RockawayX, Delphi Labs, Hashkey, AppWorks, Matrix Partners, Bankless Ventures, and more.
GambleFAI
Sportstensor is an SN41 subnet on the dTAO that is an AI platform for sports event prediction, enabling participants (miners and validators) to collaborate in developing and optimizing sports prediction models. Participants with better models and datasets that can predict sports match outcomes profit from their participation. Users can engage with the project either technically by "developing models" or non-technically by "using prediction results."
For example, in an NBA game between the Celtics and the Magic with odds of 0.92:0.08, if you follow the market odds and bet on the Celtics (the popularly favored team), your win rate is about 92%. However, even with such a high win rate, after multiple bets, most people's return on investment is negative. While the popularly favored team often has a higher win rate, they also have higher odds, meaning that even if the prediction is correct, the winnings are lower. People tend to bet on their favored team, leading to a low win rate for the underdog, which means that if you bet on the underdog and win, you can earn a lot of money.
This is where the advantage of the Sportstensor model lies: miners use their own data to run their machine learning models to achieve the best results. Sportstensor then takes their averages/medians and uses them as an intelligent indicator to identify market advantages. The difference between the model-predicted odds and market odds is the part where users can profit in the long run.
DeAI Infrastructure
Such products are among the earliest concepts of integrating Crypto with AI, as seen in projects like Grass. There have been countless similar products in the past, but sustaining them has been challenging. The key to decentralized computing power is how to optimize synchronous computing power and offer it at a price below that of traditional computing power providers. On the other hand, the key to decentralized training is the cost of data transmission itself, which was difficult to achieve during the infrastructure's early days. However, once achieved, it has the potential to tap into a significant underserved market, making it a focus of venture capitalists.
PrimeIntellect was co-founded by Vincent Weisser and Johannes Hagemann, both of whom were previously key members of Desci's leading VitaDAO. PrimeIntellect is a platform that commodifies computing power and models. The investment lineup is quite impressive, with a $5 million seed round led by CoinFund and Distributed Global, and a $15 million second round led by Founders Fund. Individual investors include prominent figures in the industry such as Polygon co-founder Sandeep Nailwal, notable investors, and former Coinbase CTO Balaji.
Recently, renowned OpenAI researcher Yaoshunyu published an article titled "The Second Half," where he stated that we are currently at AI's halftime, with the second half soon approaching. If the first half of AI focused on gaming and exam-solving, the second half will see AI build valuable products to establish companies worth tens of billions or trillions of dollars in value. This will undoubtedly present opportunities for CryptoAI as well.
So stay tuned and welcome to the second half.
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China's Central Bank and Eight Other Departments' Latest Regulatory Focus: Key Attention to RWA Tokenized Asset Risk
Foreword: Today, the People's Bank of China's website published the "Notice of the People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, State Administration of Foreign Exchange on Further Preventing and Dealing with Risks Related to Virtual Currency and Others (Yinfa [2026] No. 42)", the latest regulatory requirements from the eight departments including the central bank, which are basically consistent with the regulatory requirements of recent years. The main focus of the regulation is on speculative activities such as virtual currency trading, exchanges, ICOs, overseas platform services, and this time, regulatory oversight of RWA has been added, explicitly prohibiting RWA tokenization, stablecoins (especially those pegged to the RMB). The following is the full text:
To the people's governments of all provinces, autonomous regions, and municipalities directly under the Central Government, the Xinjiang Production and Construction Corps:
Recently, there have been speculative activities related to virtual currency and Real-World Assets (RWA) tokenization, disrupting the economic and financial order and jeopardizing the property security of the people. In order to further prevent and address the risks related to virtual currency and Real-World Assets tokenization, effectively safeguard national security and social stability, in accordance with the "Law of the People's Republic of China on the People's Bank of China," "Law of the People's Republic of China on Commercial Banks," "Securities Law of the People's Republic of China," "Law of the People's Republic of China on Securities Investment Funds," "Law of the People's Republic of China on Futures and Derivatives," "Cybersecurity Law of the People's Republic of China," "Regulations of the People's Republic of China on the Administration of Renminbi," "Regulations on Prevention and Disposal of Illegal Fundraising," "Regulations of the People's Republic of China on Foreign Exchange Administration," "Telecommunications Regulations of the People's Republic of China," and other provisions, after reaching consensus with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and with the approval of the State Council, the relevant matters are notified as follows:
(I) Virtual currency does not possess the legal status equivalent to fiat currency. Virtual currencies such as Bitcoin, Ether, Tether, etc., have the main characteristics of being issued by non-monetary authorities, using encryption technology and distributed ledger or similar technology, existing in digital form, etc. They do not have legal tender status, should not and cannot be circulated and used as currency in the market.
The business activities related to virtual currency are classified as illegal financial activities. The exchange of fiat currency and virtual currency within the territory, exchange of virtual currencies, acting as a central counterparty in buying and selling virtual currencies, providing information intermediary and pricing services for virtual currency transactions, token issuance financing, and trading of virtual currency-related financial products, etc., fall under illegal financial activities, such as suspected illegal issuance of token vouchers, unauthorized public issuance of securities, illegal operation of securities and futures business, illegal fundraising, etc., are strictly prohibited across the board and resolutely banned in accordance with the law. Overseas entities and individuals are not allowed to provide virtual currency-related services to domestic entities in any form.
A stablecoin pegged to a fiat currency indirectly fulfills some functions of the fiat currency in circulation. Without the consent of relevant authorities in accordance with the law and regulations, any domestic or foreign entity or individual is not allowed to issue a RMB-pegged stablecoin overseas.
（II）Tokenization of Real-World Assets refers to the use of encryption technology and distributed ledger or similar technologies to transform ownership rights, income rights, etc., of assets into tokens (tokens) or other interests or bond certificates with token (token) characteristics, and carry out issuance and trading activities.
Engaging in the tokenization of real-world assets domestically, as well as providing related intermediary, information technology services, etc., which are suspected of illegal issuance of token vouchers, unauthorized public offering of securities, illegal operation of securities and futures business, illegal fundraising, and other illegal financial activities, shall be prohibited; except for relevant business activities carried out with the approval of the competent authorities in accordance with the law and regulations and relying on specific financial infrastructures. Overseas entities and individuals are not allowed to illegally provide services related to the tokenization of real-world assets to domestic entities in any form.
(III) Inter-agency Coordination. The People's Bank of China, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of virtual currency-related illegal financial activities.
The China Securities Regulatory Commission, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of illegal financial activities related to the tokenization of real-world assets.
(IV) Strengthening Local Implementation. The people's governments at the provincial level are overall responsible for the prevention and disposal of risks related to virtual currencies and the tokenization of real-world assets in their respective administrative regions. The specific leading department is the local financial regulatory department, with participation from branches and dispatched institutions of the State Council's financial regulatory department, telecommunications regulators, public security, market supervision, and other departments, in coordination with cyberspace departments, courts, and procuratorates, to improve the normalization of the work mechanism, effectively connect with the relevant work mechanisms of central departments, form a cooperative and coordinated working pattern between central and local governments, effectively prevent and properly handle risks related to virtual currencies and the tokenization of real-world assets, and maintain economic and financial order and social stability.
(5) Enhanced Risk Monitoring. The People's Bank of China, China Securities Regulatory Commission, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration of Foreign Exchange, Cyberspace Administration of China, and other departments continue to improve monitoring techniques and system support, enhance cross-departmental data analysis and sharing, establish sound information sharing and cross-validation mechanisms, promptly grasp the risk situation of activities related to virtual currency and real-world asset tokenization. Local governments at all levels give full play to the role of local monitoring and early warning mechanisms. Local financial regulatory authorities, together with branches and agencies of the State Council's financial regulatory authorities, as well as departments of cyberspace and public security, ensure effective connection between online monitoring, offline investigation, and fund tracking, efficiently and accurately identify activities related to virtual currency and real-world asset tokenization, promptly share risk information, improve early warning information dissemination, verification, and rapid response mechanisms.
(6) Strengthened Oversight of Financial Institutions, Intermediaries, and Technology Service Providers. Financial institutions (including non-bank payment institutions) are prohibited from providing account opening, fund transfer, and clearing services for virtual currency-related business activities, issuing and selling financial products related to virtual currency, including virtual currency and related financial products in the scope of collateral, conducting insurance business related to virtual currency, or including virtual currency in the scope of insurance liability. Financial institutions (including non-bank payment institutions) are prohibited from providing custody, clearing, and settlement services for unauthorized real-world asset tokenization-related business and related financial products. Relevant intermediary institutions and information technology service providers are prohibited from providing intermediary, technical, or other services for unauthorized real-world asset tokenization-related businesses and related financial products.
(7) Enhanced Management of Internet Information Content and Access. Internet enterprises are prohibited from providing online business venues, commercial displays, marketing, advertising, or paid traffic diversion services for virtual currency and real-world asset tokenization-related business activities. Upon discovering clues of illegal activities, they should promptly report to relevant departments and provide technical support and assistance for related investigations and inquiries. Based on the clues transferred by the financial regulatory authorities, the cyberspace administration, telecommunications authorities, and public security departments should promptly close and deal with websites, mobile applications (including mini-programs), and public accounts engaged in virtual currency and real-world asset tokenization-related business activities in accordance with the law.
(8) Strengthened Entity Registration and Advertisement Management. Market supervision departments strengthen entity registration and management, and enterprise and individual business registrations must not contain terms such as "virtual currency," "virtual asset," "cryptocurrency," "crypto asset," "stablecoin," "real-world asset tokenization," or "RWA" in their names or business scopes. Market supervision departments, together with financial regulatory authorities, legally enhance the supervision of advertisements related to virtual currency and real-world asset tokenization, promptly investigating and handling relevant illegal advertisements.
（IX） Continued Rectification of Virtual Currency Mining Activities. The National Development and Reform Commission, together with relevant departments, strictly controls virtual currency mining activities, continuously promotes the rectification of virtual currency mining activities. The people's governments of various provinces take overall responsibility for the rectification of "mining" within their respective administrative regions. In accordance with the requirements of the National Development and Reform Commission and other departments in the "Notice on the Rectification of Virtual Currency Mining Activities" (NDRC Energy-saving Building [2021] No. 1283) and the provisions of the "Guidance Catalog for Industrial Structure Adjustment (2024 Edition)," a comprehensive review, investigation, and closure of existing virtual currency mining projects are conducted, new mining projects are strictly prohibited, and mining machine production enterprises are strictly prohibited from providing mining machine sales and other services within the country.
（X） Severe Crackdown on Related Illegal Financial Activities. Upon discovering clues to illegal financial activities related to virtual currency and the tokenization of real-world assets, local financial regulatory authorities, branches of the State Council's financial regulatory authorities, and other relevant departments promptly investigate, determine, and properly handle the issues in accordance with the law, and seriously hold the relevant entities and individuals legally responsible. Those suspected of crimes are transferred to the judicial authorities for processing according to the law.
（XI） Severe Crackdown on Related Illegal and Criminal Activities. The Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, as well as judicial and procuratorial organs, in accordance with their respective responsibilities, rigorously crack down on illegal and criminal activities related to virtual currency, the tokenization of real-world assets, such as fraud, money laundering, illegal business operations, pyramid schemes, illegal fundraising, and other illegal and criminal activities carried out under the guise of virtual currency, the tokenization of real-world assets, etc.
（XII） Strengthen Industry Self-discipline. Relevant industry associations should enhance membership management and policy advocacy, based on their own responsibilities, advocate and urge member units to resist illegal financial activities related to virtual currency and the tokenization of real-world assets. Member units that violate regulatory policies and industry self-discipline rules are to be disciplined in accordance with relevant self-regulatory management regulations. By leveraging various industry infrastructure, conduct risk monitoring related to virtual currency, the tokenization of real-world assets, and promptly transfer issue clues to relevant departments.
（XIII） Without the approval of relevant departments in accordance with the law and regulations, domestic entities and foreign entities controlled by them may not issue virtual currency overseas.
（XIV） Domestic entities engaging directly or indirectly in overseas external debt-based tokenization of real-world assets, or conducting asset securitization activities abroad based on domestic ownership rights, income rights, etc. (hereinafter referred to as domestic equity), should be strictly regulated in accordance with the principles of "same business, same risk, same rules." The National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments regulate it according to their respective responsibilities. For other forms of overseas real-world asset tokenization activities based on domestic equity by domestic entities, the China Securities Regulatory Commission, together with relevant departments, supervise according to their division of responsibilities. Without the consent and filing of relevant departments, no unit or individual may engage in the above-mentioned business.
(15) Overseas subsidiaries and branches of domestic financial institutions providing Real World Asset Tokenization-related services overseas shall do so legally and prudently. They shall have professional personnel and systems in place to effectively mitigate business risks, strictly implement customer onboarding, suitability management, anti-money laundering requirements, and incorporate them into the domestic financial institutions' compliance and risk management system. Intermediaries and information technology service providers offering Real World Asset Tokenization services abroad based on domestic equity or conducting Real World Asset Tokenization business in the form of overseas debt for domestic entities directly or indirectly venturing abroad must strictly comply with relevant laws and regulations. They should establish and improve relevant compliance and internal control systems in accordance with relevant normative requirements, strengthen business and risk control, and report the business developments to the relevant regulatory authorities for approval or filing.
(16) Strengthen organizational leadership and overall coordination. All departments and regions should attach great importance to the prevention of risks related to virtual currencies and Real World Asset Tokenization, strengthen organizational leadership, clarify work responsibilities, form a long-term effective working mechanism with centralized coordination, local implementation, and shared responsibilities, maintain high pressure, dynamically monitor risks, effectively prevent and mitigate risks in an orderly and efficient manner, legally protect the property security of the people, and make every effort to maintain economic and financial order and social stability.
(17) Widely carry out publicity and education. All departments, regions, and industry associations should make full use of various media and other communication channels to disseminate information through legal and policy interpretation, analysis of typical cases, and education on investment risks, etc. They should promote the illegality and harm of virtual currencies and Real World Asset Tokenization-related businesses and their manifestations, fully alert to potential risks and hidden dangers, and enhance public awareness and identification capabilities for risk prevention.
(18) Engaging in illegal financial activities related to virtual currencies and Real World Asset Tokenization in violation of this notice, as well as providing services for virtual currencies and Real World Asset Tokenization-related businesses, shall be punished in accordance with relevant regulations. If it constitutes a crime, criminal liability shall be pursued according to the law. For domestic entities and individuals who knowingly or should have known that overseas entities illegally provided virtual currency or Real World Asset Tokenization-related services to domestic entities and still assisted them, relevant responsibilities shall be pursued according to the law. If it constitutes a crime, criminal liability shall be pursued according to the law.
(19) If any unit or individual invests in virtual currencies, Real World Asset Tokens, and related financial products against public order and good customs, the relevant civil legal actions shall be invalid, and any resulting losses shall be borne by them. If there are suspicions of disrupting financial order and jeopardizing financial security, the relevant departments shall deal with them according to the law.
This notice shall enter into force upon the date of its issuance. The People's Bank of China and ten other departments' "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading Speculation" (Yinfa [2021] No. 237) is hereby repealed.
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Foreword: Today, the People's Bank of China's website published the "Notice of the People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, State Administration of Foreign Exchange on Further Preventing and Dealing with Risks Related to Virtual Currency and Others (Yinfa [2026] No. 42)", the latest regulatory requirements from the eight departments including the central bank, which are basically consistent with the regulatory requirements of recent years. The main focus of the regulation is on speculative activities such as virtual currency trading, exchanges, ICOs, overseas platform services, and this time, regulatory oversight of RWA has been added, explicitly prohibiting RWA tokenization, stablecoins (especially those pegged to the RMB). The following is the full text:
To the people's governments of all provinces, autonomous regions, and municipalities directly under the Central Government, the Xinjiang Production and Construction Corps:
Recently, there have been speculative activities related to virtual currency and Real-World Assets (RWA) tokenization, disrupting the economic and financial order and jeopardizing the property security of the people. In order to further prevent and address the risks related to virtual currency and Real-World Assets tokenization, effectively safeguard national security and social stability, in accordance with the "Law of the People's Republic of China on the People's Bank of China," "Law of the People's Republic of China on Commercial Banks," "Securities Law of the People's Republic of China," "Law of the People's Republic of China on Securities Investment Funds," "Law of the People's Republic of China on Futures and Derivatives," "Cybersecurity Law of the People's Republic of China," "Regulations of the People's Republic of China on the Administration of Renminbi," "Regulations on Prevention and Disposal of Illegal Fundraising," "Regulations of the People's Republic of China on Foreign Exchange Administration," "Telecommunications Regulations of the People's Republic of China," and other provisions, after reaching consensus with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, and with the approval of the State Council, the relevant matters are notified as follows:
(I) Virtual currency does not possess the legal status equivalent to fiat currency. Virtual currencies such as Bitcoin, Ether, Tether, etc., have the main characteristics of being issued by non-monetary authorities, using encryption technology and distributed ledger or similar technology, existing in digital form, etc. They do not have legal tender status, should not and cannot be circulated and used as currency in the market.
The business activities related to virtual currency are classified as illegal financial activities. The exchange of fiat currency and virtual currency within the territory, exchange of virtual currencies, acting as a central counterparty in buying and selling virtual currencies, providing information intermediary and pricing services for virtual currency transactions, token issuance financing, and trading of virtual currency-related financial products, etc., fall under illegal financial activities, such as suspected illegal issuance of token vouchers, unauthorized public issuance of securities, illegal operation of securities and futures business, illegal fundraising, etc., are strictly prohibited across the board and resolutely banned in accordance with the law. Overseas entities and individuals are not allowed to provide virtual currency-related services to domestic entities in any form.
A stablecoin pegged to a fiat currency indirectly fulfills some functions of the fiat currency in circulation. Without the consent of relevant authorities in accordance with the law and regulations, any domestic or foreign entity or individual is not allowed to issue a RMB-pegged stablecoin overseas.
（II）Tokenization of Real-World Assets refers to the use of encryption technology and distributed ledger or similar technologies to transform ownership rights, income rights, etc., of assets into tokens (tokens) or other interests or bond certificates with token (token) characteristics, and carry out issuance and trading activities.
Engaging in the tokenization of real-world assets domestically, as well as providing related intermediary, information technology services, etc., which are suspected of illegal issuance of token vouchers, unauthorized public offering of securities, illegal operation of securities and futures business, illegal fundraising, and other illegal financial activities, shall be prohibited; except for relevant business activities carried out with the approval of the competent authorities in accordance with the law and regulations and relying on specific financial infrastructures. Overseas entities and individuals are not allowed to illegally provide services related to the tokenization of real-world assets to domestic entities in any form.
(III) Inter-agency Coordination. The People's Bank of China, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of virtual currency-related illegal financial activities.
The China Securities Regulatory Commission, together with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the State Administration of Foreign Exchange, and other departments, will improve the work mechanism, strengthen coordination with the Cyberspace Administration of China, the Supreme People's Court, and the Supreme People's Procuratorate, coordinate efforts, and overall guide regions to carry out risk prevention and disposal of illegal financial activities related to the tokenization of real-world assets.
(IV) Strengthening Local Implementation. The people's governments at the provincial level are overall responsible for the prevention and disposal of risks related to virtual currencies and the tokenization of real-world assets in their respective administrative regions. The specific leading department is the local financial regulatory department, with participation from branches and dispatched institutions of the State Council's financial regulatory department, telecommunications regulators, public security, market supervision, and other departments, in coordination with cyberspace departments, courts, and procuratorates, to improve the normalization of the work mechanism, effectively connect with the relevant work mechanisms of central departments, form a cooperative and coordinated working pattern between central and local governments, effectively prevent and properly handle risks related to virtual currencies and the tokenization of real-world assets, and maintain economic and financial order and social stability.
(5) Enhanced Risk Monitoring. The People's Bank of China, China Securities Regulatory Commission, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration of Foreign Exchange, Cyberspace Administration of China, and other departments continue to improve monitoring techniques and system support, enhance cross-departmental data analysis and sharing, establish sound information sharing and cross-validation mechanisms, promptly grasp the risk situation of activities related to virtual currency and real-world asset tokenization. Local governments at all levels give full play to the role of local monitoring and early warning mechanisms. Local financial regulatory authorities, together with branches and agencies of the State Council's financial regulatory authorities, as well as departments of cyberspace and public security, ensure effective connection between online monitoring, offline investigation, and fund tracking, efficiently and accurately identify activities related to virtual currency and real-world asset tokenization, promptly share risk information, improve early warning information dissemination, verification, and rapid response mechanisms.
(6) Strengthened Oversight of Financial Institutions, Intermediaries, and Technology Service Providers. Financial institutions (including non-bank payment institutions) are prohibited from providing account opening, fund transfer, and clearing services for virtual currency-related business activities, issuing and selling financial products related to virtual currency, including virtual currency and related financial products in the scope of collateral, conducting insurance business related to virtual currency, or including virtual currency in the scope of insurance liability. Financial institutions (including non-bank payment institutions) are prohibited from providing custody, clearing, and settlement services for unauthorized real-world asset tokenization-related business and related financial products. Relevant intermediary institutions and information technology service providers are prohibited from providing intermediary, technical, or other services for unauthorized real-world asset tokenization-related businesses and related financial products.
(7) Enhanced Management of Internet Information Content and Access. Internet enterprises are prohibited from providing online business venues, commercial displays, marketing, advertising, or paid traffic diversion services for virtual currency and real-world asset tokenization-related business activities. Upon discovering clues of illegal activities, they should promptly report to relevant departments and provide technical support and assistance for related investigations and inquiries. Based on the clues transferred by the financial regulatory authorities, the cyberspace administration, telecommunications authorities, and public security departments should promptly close and deal with websites, mobile applications (including mini-programs), and public accounts engaged in virtual currency and real-world asset tokenization-related business activities in accordance with the law.
(8) Strengthened Entity Registration and Advertisement Management. Market supervision departments strengthen entity registration and management, and enterprise and individual business registrations must not contain terms such as "virtual currency," "virtual asset," "cryptocurrency," "crypto asset," "stablecoin," "real-world asset tokenization," or "RWA" in their names or business scopes. Market supervision departments, together with financial regulatory authorities, legally enhance the supervision of advertisements related to virtual currency and real-world asset tokenization, promptly investigating and handling relevant illegal advertisements.
（IX） Continued Rectification of Virtual Currency Mining Activities. The National Development and Reform Commission, together with relevant departments, strictly controls virtual currency mining activities, continuously promotes the rectification of virtual currency mining activities. The people's governments of various provinces take overall responsibility for the rectification of "mining" within their respective administrative regions. In accordance with the requirements of the National Development and Reform Commission and other departments in the "Notice on the Rectification of Virtual Currency Mining Activities" (NDRC Energy-saving Building [2021] No. 1283) and the provisions of the "Guidance Catalog for Industrial Structure Adjustment (2024 Edition)," a comprehensive review, investigation, and closure of existing virtual currency mining projects are conducted, new mining projects are strictly prohibited, and mining machine production enterprises are strictly prohibited from providing mining machine sales and other services within the country.
（X） Severe Crackdown on Related Illegal Financial Activities. Upon discovering clues to illegal financial activities related to virtual currency and the tokenization of real-world assets, local financial regulatory authorities, branches of the State Council's financial regulatory authorities, and other relevant departments promptly investigate, determine, and properly handle the issues in accordance with the law, and seriously hold the relevant entities and individuals legally responsible. Those suspected of crimes are transferred to the judicial authorities for processing according to the law.
（XI） Severe Crackdown on Related Illegal and Criminal Activities. The Ministry of Public Security, the People's Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, as well as judicial and procuratorial organs, in accordance with their respective responsibilities, rigorously crack down on illegal and criminal activities related to virtual currency, the tokenization of real-world assets, such as fraud, money laundering, illegal business operations, pyramid schemes, illegal fundraising, and other illegal and criminal activities carried out under the guise of virtual currency, the tokenization of real-world assets, etc.
（XII） Strengthen Industry Self-discipline. Relevant industry associations should enhance membership management and policy advocacy, based on their own responsibilities, advocate and urge member units to resist illegal financial activities related to virtual currency and the tokenization of real-world assets. Member units that violate regulatory policies and industry self-discipline rules are to be disciplined in accordance with relevant self-regulatory management regulations. By leveraging various industry infrastructure, conduct risk monitoring related to virtual currency, the tokenization of real-world assets, and promptly transfer issue clues to relevant departments.
（XIII） Without the approval of relevant departments in accordance with the law and regulations, domestic entities and foreign entities controlled by them may not issue virtual currency overseas.
（XIV） Domestic entities engaging directly or indirectly in overseas external debt-based tokenization of real-world assets, or conducting asset securitization activities abroad based on domestic ownership rights, income rights, etc. (hereinafter referred to as domestic equity), should be strictly regulated in accordance with the principles of "same business, same risk, same rules." The National Development and Reform Commission, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other relevant departments regulate it according to their respective responsibilities. For other forms of overseas real-world asset tokenization activities based on domestic equity by domestic entities, the China Securities Regulatory Commission, together with relevant departments, supervise according to their division of responsibilities. Without the consent and filing of relevant departments, no unit or individual may engage in the above-mentioned business.
(15) Overseas subsidiaries and branches of domestic financial institutions providing Real World Asset Tokenization-related services overseas shall do so legally and prudently. They shall have professional personnel and systems in place to effectively mitigate business risks, strictly implement customer onboarding, suitability management, anti-money laundering requirements, and incorporate them into the domestic financial institutions' compliance and risk management system. Intermediaries and information technology service providers offering Real World Asset Tokenization services abroad based on domestic equity or conducting Real World Asset Tokenization business in the form of overseas debt for domestic entities directly or indirectly venturing abroad must strictly comply with relevant laws and regulations. They should establish and improve relevant compliance and internal control systems in accordance with relevant normative requirements, strengthen business and risk control, and report the business developments to the relevant regulatory authorities for approval or filing.
(16) Strengthen organizational leadership and overall coordination. All departments and regions should attach great importance to the prevention of risks related to virtual currencies and Real World Asset Tokenization, strengthen organizational leadership, clarify work responsibilities, form a long-term effective working mechanism with centralized coordination, local implementation, and shared responsibilities, maintain high pressure, dynamically monitor risks, effectively prevent and mitigate risks in an orderly and efficient manner, legally protect the property security of the people, and make every effort to maintain economic and financial order and social stability.
(17) Widely carry out publicity and education. All departments, regions, and industry associations should make full use of various media and other communication channels to disseminate information through legal and policy interpretation, analysis of typical cases, and education on investment risks, etc. They should promote the illegality and harm of virtual currencies and Real World Asset Tokenization-related businesses and their manifestations, fully alert to potential risks and hidden dangers, and enhance public awareness and identification capabilities for risk prevention.
(18) Engaging in illegal financial activities related to virtual currencies and Real World Asset Tokenization in violation of this notice, as well as providing services for virtual currencies and Real World Asset Tokenization-related businesses, shall be punished in accordance with relevant regulations. If it constitutes a crime, criminal liability shall be pursued according to the law. For domestic entities and individuals who knowingly or should have known that overseas entities illegally provided virtual currency or Real World Asset Tokenization-related services to domestic entities and still assisted them, relevant responsibilities shall be pursued according to the law. If it constitutes a crime, criminal liability shall be pursued according to the law.
(19) If any unit or individual invests in virtual currencies, Real World Asset Tokens, and related financial products against public order and good customs, the relevant civil legal actions shall be invalid, and any resulting losses shall be borne by them. If there are suspicions of disrupting financial order and jeopardizing financial security, the relevant departments shall deal with them according to the law.
This notice shall enter into force upon the date of its issuance. The People's Bank of China and ten other departments' "Notice on Further Preventing and Dealing with the Risks of Virtual Currency Trading Speculation" (Yinfa [2021] No. 237) is hereby repealed.
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