China's RWA Ban Triggers Market Fear: ETF Inflows Halt, Liquidations Spike to $208M

Source: Coinomedia Original Title: China’s RWA Ban Triggers Market Fear Original Link: https://coinomedia.com/china-rwa-tokenization-ban/

Market Pressure Builds Following RWA Tokenization Restrictions

The crypto market is experiencing significant pressure following recent regulatory restrictions on Real World Asset (RWA) tokenization, a move that’s igniting uncertainty among global investors. The effects are already visible: top cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are slipping, with prices currently down by -1.3% and -0.4% respectively.

RWA tokenization, a process of representing physical assets like real estate or bonds on blockchain, has been gaining traction globally. However, the decision to restrict this financial innovation has raised alarms, especially given its potential to limit future institutional participation in crypto markets.

ETF Inflows Stall as Fear Takes Over

Adding to the concern is the persistent stagnation in spot ETF inflows. Both Bitcoin and Ethereum ETFs have recorded no net inflows for nine consecutive days. This unusual silence in ETF activity reflects cautious behavior from both retail and institutional investors, who are waiting for clearer market signals before committing fresh capital.

The Fear and Greed Index (FGI) has plunged to 22, firmly placing the market in the “Extreme Fear” zone. This sentiment drop indicates that traders are bracing for further volatility and possible downside.

Amid regulatory restrictions on RWA tokenization, the crypto market is falling, with BTC and ETH ETFs seeing no significant inflows for nine days, signaling ongoing investor caution.

BTC: $90,491 -1.3%
ETH: $3,120 -0.4%
FGI: 22 → Extreme Fear
Market Cap: $3.26T
Liquidations: $208M

Market Cap Drops and Liquidations Spike

The total crypto market capitalization now sits at $3.26 trillion, reflecting the pullback in investor enthusiasm. Meanwhile, over $208 million in liquidations were recorded across crypto exchanges, underlining the increasing risk-off mood and high leverage exposure among traders.

As regulatory developments continue to unfold, the global crypto community remains on high alert. Market participants will be watching closely for any signs of reversal in ETF flows or a shift in sentiment that could stabilize prices moving forward.