Breaking News! The nuclear-level ban by the great Eastern power has been implemented, shattering Hong Kong's crypto hub dreams. Is $BTC the countdown to a new wave of collapse? Last year, many observers speculated that China's stance on digital assets might soften. This speculation largely stemmed from its central bank governor's vision of challenging the US dollar's dominance with the renminbi. However, on February 7th this year, all hopes of a thaw were completely frozen by an official document. During the latest downturn in the cryptocurrency market, Chinese regulators tightened policies against cryptocurrency and real asset tokenization. The new regulations explicitly prohibit domestic institutions from issuing digital tokens overseas and ban the issuance of stablecoins pegged to the renminbi without approval. The official reason given was to prevent currency sovereignty risks. A blockchain policy analyst pointed out that China's attitude toward stablecoins has been mostly tentative, and has cooled significantly in recent months. She believes this announcement has completely dashed any hopes of launching offshore renminbi stablecoins in the short term, and the Hong Kong plan has essentially fallen apart. This is a heavy blow to Hong Kong's goal of becoming a digital asset center. In June last year, Hong Kong's financial affairs chief stated that, based on regulatory requirements, linking Hong Kong stablecoins to the renminbi was not ruled out. Now, the general consensus is that this door has been firmly closed. The signals of tightening had been evident earlier. In August last year, China already required local brokerages and related institutions to cease publishing stablecoin research reports and hosting promotional activities to cool the market. A legal advisor from another blockchain company said that last week's policy eliminated market uncertainty regarding private issuance of renminbi stablecoins, making issuers clearly aware of the red lines. Licensed institutions can now only focus on issuing stablecoins pegged to the Hong Kong dollar. Previously, there were reports that about fifty companies in Hong Kong planned to apply for stablecoin licenses, including Ant Group and JD.com. However, according to a report from October last year, these plans were forced to be put on hold after Beijing's intervention. Neither company responded to requests for comment. So far, Hong Kong has issued licenses to eleven cryptocurrency exchanges and approved sixty-two companies to conduct digital asset trading for clients, including several with Chinese financial backgrounds. But industry insiders are concerned: if access to the renminbi is blocked, the entire strategy could be futile. The legal advisor's view is spot on: the issue has never been about Hong Kong's regulatory framework, but whether China will tolerate the circulation of renminbi-denominated tools outside its control. Capital controls and the liberalization of stablecoins are fundamentally mutually exclusive. Weak market data underscores this policy cold wave. Since October last year, open interest in BTC perpetual futures has been declining and has failed to rebound effectively, highlighting a lack of solid confidence supporting this market recovery. Data shows that its size has shrunk by about fifty percent from its October high. Capital outflows are equally severe. Since the market crash in early October last year, investors have withdrawn approximately $3.3 billion from US-based ETH ETFs. This year alone, net outflows from such funds have exceeded $500 million. Currently, the assets under management of $ETH ETFs have fallen below $130 billion, the lowest since July last year. Against this backdrop, risk investment funds in the crypto industry are shifting focus. A founder of a crypto private equity firm said that the market is consolidating around truly effective areas. Even well-funded native crypto venture capital firms are heavily shifting toward fintech, stablecoin infrastructure, and on-chain prediction markets, with other sectors struggling to attract attention.