New policies in the financial sector have been introduced, bringing new opportunities for cross-border investment and the Blockchain industry.

Five departments recently jointly issued the "Opinions on Promoting Institutional Opening Up to International High Standards in Conditional Free Trade Pilot Zones (Ports) in the Financial Sector" (hereinafter referred to as "Opinions"), proposing 20 policy measures, marking the arrival of a new wave of openness in the financial industry. These measures will not only impact the traditional financial sector but also contain significant opportunities for cross-border investment, Blockchain, and the cryptocurrency industry.

1. New Financial Service Pilot and "Cross-Border Wealth Management Connect" Expansion

The "Opinions" propose to pilot new financial services in multiple free trade zones and cooperation platforms, specifically financial services that are not yet provided within our country but exist and are regulated in other countries or regions. Notably, the "Cross-Border Wealth Management Connect" pilot will be further optimized in the Guangdong-Hong Kong-Macao Greater Bay Area, supporting residents from the mainland of the Greater Bay Area to purchase qualified investment products through Hong Kong and Macao financial institutions, and expand the range of participating institutions and types of products.

This means that in the future, there may be more innovative financial products, such as Hong Kong's virtual asset ETFs, opened to mainland investors through the "Cross-Border Wealth Management Connect", enriching investment options. Foreign financial institutions will also be allowed to conduct new financial services similar to those of Chinese institutions in pilot areas, with a simplified application process and clear approval timelines.

2. Facilitation of Cross-Border Capital Flow

The new policy significantly relaxes the restrictions on fund transfers related to foreign investment in pilot areas. Under the premise of real compliance, it allows various types of funds such as capital contributions, profits, dividends, and interest to flow in and out freely without delay. This measure will greatly enhance the convenience of cross-border investment, benefiting the attraction of more international capital to participate in the domestic financial market, while also providing domestic enterprises with a more efficient way of managing funds.

3. Improvement of Cross-Border Flow Arrangements for Financial Data

The "Opinions" also proposed to facilitate and regulate the cross-border flow of data from financial institutions in pilot areas. Within the framework of the national data security management, it aims to explore the formation of unified compliance standards for the cross-border flow of financial data, clarify relevant rules, and allow financial institutions in pilot areas to transmit data required for daily operations to overseas in accordance with the law. This policy may bring significant benefits to Real-World Asset (RWA) tokenization projects.

RWA involves converting real-world assets into digital tokens on the Blockchain, a process that requires extensive data collection, storage, and transfer. Active cross-border data flow policies can not only support the implementation of RWA projects but also reduce data processing and compliance costs for all parties, improving operational efficiency. In the long run, RWA is expected to become one of the important ways for domestic enterprises to broaden their financing channels.

IV. Outlook

The new policy opens a new chapter for the development of cross-border financial services and new financial products. With the introduction of more pilot projects, it is expected that more compliant financial institutions will launch innovative products. Institutions that take the lead in launching highlight products may receive higher attention and capital inflow, creating a demonstration effect that attracts more participants into the field.

It is recommended that financial institutions and investors, especially participants in the blockchain and cryptocurrency sector, maintain continuous attention to the various measures taken by the People's Bank of China and relevant departments regarding the "Opinions" and seize the development opportunities brought by policy dividends.