Stablecoin activity in China is moving through a channel that regulators have struggled to touch. Unique wallets sending peer-to-peer stablecoin transactions in the country grew 43-fold between the first quarter of 2024 and the second quarter of 2026, according to Cointelegraph, citing Chainalysis.
The growth took place while Chinese authorities kept trading restrictions in place and reinforced them. In February 2026, regulators issued new rules targeting unauthorized yuan-pegged stablecoins and tokenized real-world assets, per Cointelegraph.
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Key facts
- Chainalysis recorded $104.1 billion across 18.1 million self-custodied stablecoin transfers involving China’s on-chain holdings during its 2026 reporting period, which ran from July 2025 to June 2026, according to Cointelegraph.
- Stablecoin holdings in China turned over 33.2 times per year, compared with a global average of 9.3, Chainalysis said.
- Domestic P2P activity made up 59.1% of China’s crypto economy, which Chainalysis estimated at no less than $176 billion, about 3.5 times the P2P share in the 2025 reporting period.
- March 2026 added $4.9 billion in domestic stablecoin transfer volume, the largest monthly increase shown in the report.
- Cryptobriefing reported the same figures for China from the Chainalysis East Asia Crypto Adoption Report, released on October 5, 2026, and noted that self-custody means users hold their own keys with no exchange in the middle.
Coin turnover points to spending, not saving
Chainalysis read the turnover rate as evidence that users treat stablecoins as working capital rather than as a store of value. Cryptobriefing put it the same way, noting that the coins are being spent, settled and passed along rather than parked.
That behavior fits the wallet data from Cryptopolitan’s account of the report. The count of distinct wallets sending peer-to-peer stablecoin transfers inside China rose 43 times over the same window, and Cryptopolitan described the gap between written rules and actual usage as widest in mainland China, where trading has been outlawed for years.
Also read: Visa survey: US stablecoin use could rise to 56% with bank-like cover
East Asia’s markets diverge
China’s P2P-heavy market sits alongside very different neighbors. Cointelegraph reported that South Korea ranked as East Asia’s largest crypto economy at $449.1 billion, with activity up 12.3% from the previous period and retail traders leaning toward AI-linked tokens. Cryptopolitan attributes $51.1 billion of exchange-related flows to that market and described it as overwhelmingly retail.
Hong Kong stands out for institutional flows. According to Cointelegraph, institutional platforms accounted for 16% of service inflows, nearly triple the share of any regional neighbor, and the city took in almost $24 billion in inbound business-to-business flows. Cryptopolitan added that 85% of that institutional share went to custody providers, prime brokers and market makers, and that institutional platform receipts grew 87% in a year. Cryptopolitan also reported that the Hong Kong Monetary Authority issued the first two stablecoin issuer licenses on April 10, 2026, to HSBC and Anchorpoint, a venture backed by Standard Chartered, HKT and Animoca Brands, chosen from 36 applicants under an ordinance that took effect in August 2025. Neither firm yet has a venue, trading pair or start date for its coin, and the bill meant to license virtual-asset trading platforms is due to be reviewed later this year.
The two outlets differ on how to describe the scale of the region. Cryptobriefing valued South Korea’s crypto economy at roughly $1.2 trillion, while Cointelegraph attributed the $1.2 trillion figure to East Asia as a whole. Cointelegraph ranked Japan’s DEX activity at nearly 35% of service activity, with 65.7% of swaps between $10 and $1,000 and DEX activity up more than 200% since 2022; Cryptopolitan put the DEX share at 34.5%, DEX usage at more than triple 2022 levels and Japan’s market value at $228.3 billion.
Why it matters
Restrictions aimed at platforms work best when activity runs through platforms. As users move to self-custody and direct transfers, there are fewer chokepoints to press on, and the Chainalysis data suggests a meaningful share of Chinese stablecoin users has already made that move. For regulators in Beijing, the figure undercuts the idea that the ban has curbed demand for dollar-pegged tokens in a controlled currency environment. For markets elsewhere in East Asia, the split is between licensed infrastructure that is not yet trading and retail activity that is already running at scale.
What to watch
Hong Kong’s virtual-asset trading platform bill is due to be reviewed later this year, which will determine whether the licensed stablecoin issuers there get anywhere to trade. In South Korea, a 22% tax on crypto gains is set to take effect on January 1, 2027, and lawmaker Han Dong-hoon is seeking a two-year delay, Cryptopolitan reported. A petition calling for a delay has reached the 50,000 signatures needed for parliamentary review.
Nothing here is financial advice, and crypto markets are volatile and uncertain.
Reported by cointelegraph.com.
Sources: Cointelegraph, Cryptobriefing, Cryptopolitan