China’s ongoing push for digital finance is moving beyond technology-driven experimentation toward deeper institutional reforms, signaling tangible shifts in the operation and structure of capital markets. Experts at the 2025 Tongzhou Global Development Forum in Beijing emphasized that digital assets and stablecoins are poised to reshape investment logic and market participation.

“China’s capital market is entering a new stage driven by digitalization,” said Zhu Xiaoneng, Party Secretary of the School of Finance at Shanghai University of Finance and Economics. “Just as mobile payments transformed daily life, digital assets and stablecoins will redefine how capital markets function.”

According to Zhu, the tokenization of physical assets—from equities and bonds to commodities like gold—is becoming a reality. Digital representations of assets create an expanding pool of investment opportunities while enabling transparent, efficient transactions. “Tokenization marks the beginning of digital investment, while stablecoins serve as the key to unlocking this ecosystem,” Zhu noted. “They inject liquidity and build bridges between innovation and trust.”

Blockchain technology, he explained, enhances transparency and immutability, reinforcing investor confidence and widening market participation. “The future of digital finance will be defined not just by technology, but by institutions,” he said. “A multi-layered, inclusive trust framework is essential for the sustainable development of digital capital markets.”

Industry voices echoed these perspectives. Xia Le, Chief Economist for Asia-Pacific at BBVA Research, highlighted that stablecoins are increasingly influential in global capital markets but must be supported by rigorous oversight. “Stablecoins are neither fully decentralized nor inherently stable,” Xia cautioned. “Their credibility depends on institutional design and regulatory discipline.”

He also pointed to Hong Kong’s potential as a hub for innovation. A Hong Kong dollar–denominated stablecoin could expand the city’s Web3.0 ecosystem and accelerate digital transformation in the financial sector. “As a bridge in the global financial system,” Xia said, “Hong Kong can enhance cross-border payment efficiency while balancing innovation with prudent risk management.”

For international banks, asset managers, and cross-border financial service providers, China’s digital finance push offers practical opportunities. Tokenized assets and regulated stablecoins can enable exposure to China’s domestic markets with improved transparency, settlement efficiency, and risk control. The pilot initiatives provide a controlled environment for foreign participants to test new investment models in partnership with licensed domestic institutions.

Experts emphasize that the integration of digital finance with regulatory innovation is facilitating a more coordinated, resilient phase of China’s capital market opening. Wu Xiaoqiu, President of the National Academy of Financial Research, noted: “The core function of China’s capital market is shifting from traditional financing to fostering innovation and wealth creation. Reforms across assets, funding, and institutional structures will support institutional opening-up and China’s innovation-driven growth.”