Chinese P2P Crypto Transactions Hit $176 Billion Despite Ban

Despite China's ban on cryptocurrency transactions, peer-to-peer (P2P) crypto trading has surged, reaching a staggering $176 billion in volume. The share of P2P transactions increased three and a half times over the year, as users increasingly bypass traditional centralized platforms to conduct direct wallet-to-wallet transfers.

Chainalysis observed significant changes in the stablecoin market, noting that the number of unique wallets sending fiat-backed tokens to other users increased 43-fold from the first quarter of 2024 to the second quarter of 2026. Starting in March 2025, small transfers saw the fastest growth, with transactions under $100 increasing by 996%, those between $100 and $1,000 by 1,057%, and those between $1,000 and $10,000 by 1,321%.

Over the period reviewed, analysts counted 18.1 million P2P transactions involving stablecoins totaling $104.1 billion. The average amount of stablecoins held on wallets was approximately $3.1 billion, with stablecoins in China turning over about 33.2 times per year, compared to a global average of 9.3 times. Chainalysis experts believe this high turnover rate suggests that stablecoins are being used more as a payment instrument or working capital rather than as a savings asset.

The surge in P2P activity coincided with the expansion of China's social credit system into finance and internet services, beginning in March 2025. Analysts suggested that some users may have turned to cryptocurrency transactions due to limitations in traditional financial infrastructure or a desire to operate outside government-controlled systems. This contrasts with approaches in Hong Kong, Japan, Singapore, and South Korea, where digital asset transactions are gradually being moved into regulated infrastructure.