China's P2P Crypto Activity Jumps 43-Fold in Stablecoins Despite Ongoing Ban

Peer-to-peer (P2P) crypto trading among users in China has expanded sharply over the past year, even as the country maintains a strict ban on most cryptocurrency activity, according to new research. Blockchain intelligence firm Chainalysis said Chinese users are increasingly relying on P2P channels to access crypto, using informal and over-the-counter venues as alternatives to heavily restricted centralized services. Chainalysis estimates that more than $176 billion in crypto transactions has moved through China over the past two years. A key driver was a 43x surge in stablecoin turnover from Q1 2024 to Q2 2026, largely occurring in underground and OTC markets. Smaller-value transfers also accelerated beginning in March 2025. Transactions under $100 rose 996%, transfers between $100 and $1,000 increased 1057%, and those between $1,000 and $10,000 climbed 1,321%. Over the same period, analysts recorded 18.1 million P2P stablecoin transactions totaling $104.1 billion. On an annualized basis, China's stablecoin turnover reached 33.2x, well above the global average of 9.3x. Chainalysis said the gap suggests stablecoins are being used primarily as a payment tool in China rather than as a store of value. The report also links rising stablecoin usage to the 2025 expansion of the social credit system, which tracks the trustworthiness of individuals and organizations. Stablecoins can help users sidestep both monitoring in traditional financial rails and broader crypto restrictions. Mining remains illegal in China, yet China-linked mining entities still account for about 15% of global Bitcoin hashrate, Chainalysis said. Much of this capacity is located outside Chinese jurisdiction, including in parts of Africa, Central Asia, and Latin America. Regionally, Chainalysis said China's crypto activity is now concentrated around stablecoins, while markets such as Japan, Hong Kong, Singapore, and South Korea have focused more on developing regulatory frameworks. In a related move, Chinese regulators recently barred individuals and companies from issuing a digital yuan without authorization.