China’s Crypto Activity Surges to $176 Billion With P2P Transactions Dominating

China saw a significant surge in crypto activity, totaling at least $176 billion over the 12 months ending in June 2026. According to Chainalysis, 59.1% of this activity occurred through domestic peer-to-peer (P2P) transfers, a figure 3.5 times higher than in the previous period. This trend contrasts with global patterns, where exchanges remain the primary hubs for crypto transactions.

The shift was most pronounced in stablecoins, with domestic activity accelerating around March 2025 and continuing to grow for 13 consecutive months. Monthly volumes expanded from roughly $240 million to nearly $5 billion, with notable increases across various transaction ranges. Transfers under $100 surged by 996%, while transactions between $100 and $1,000 rose by 1,057%. The $1,000 to $10,000 range saw a 1,321% increase, suggesting widespread adoption by individuals and small businesses.

Chainalysis proposed that this activity might be linked to the expansion of China’s social credit system into finance and online activity in March 2025, though the company acknowledged this as a hypothesis rather than proven causation. On-chain data reveal the movement of assets but do not explain why users chose specific payment methods, making it difficult to determine the precise purpose of these transactions.

The behavior of stablecoins in wallets attributed to China further supported the idea of transactional use. These wallets held an average of $3.1 billion in stablecoins but facilitated $104.1 billion in transactions, indicating frequent recirculation of the same tokens. This poses a challenge for Chinese regulations, as dollar-pegged tokens can circulate through decentralized networks without relying on domestic financial intermediaries. The next focus will be whether this acceleration continues as China expands oversight of digital payments and financial activity.