Crypto Adoption in China Despite Ban: How 59 Million Still Trade in 2025

5 December 2025
Crypto Adoption in China Despite Ban: How 59 Million Still Trade in 2025

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Based on China's capital controls (max $50,000/year) and 2025 data showing 87% fee savings with USDT.

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Important Note: This calculator shows average fees based on article data. Actual fees may vary based on exchange rates and P2P negotiations. Crypto transfers bypass China's capital controls but carry risks of fraud and account freezes.
Security Reminder: 68% of Chinese crypto users report account freezes. Always verify counterparty identity and use escrow services. Never send large amounts in a single transaction.

China banned cryptocurrency in 2021. Trading, mining, exchanges - all illegal. Banks were told to cut off crypto-related transactions. Apps were pulled from app stores. The government pushed its own digital currency, the e-CNY, as the only legal digital money. Yet, crypto in China didn’t disappear. It went underground. And by 2025, an estimated 59 million Chinese people are still using it.

How Can Crypto Still Exist in China?

The answer isn’t loopholes. It’s adaptation. Chinese users didn’t stop because the government said so. They found ways around it - using tools and tactics most governments never expected.

Most trade happens on offshore exchanges like Binance, Bybit, and OKX. These platforms don’t operate inside China, but millions of users access them anyway. How? Through virtual private networks (VPNs). A 2024 Chainalysis report found that 78% of Chinese crypto users rely on VPNs to bypass internet restrictions. It’s not just techies - it’s students, freelancers, small business owners, even factory workers with smartphones.

Peer-to-peer (P2P) trading is the real backbone. About 63% of all crypto transactions in China happen directly between individuals. No exchange. No middleman. Just two people, often connected through WeChat or QQ groups. They use escrow services - a third party holds the money until both sides confirm the trade. Around 45% of P2P volume runs through these systems. One common method: someone sends yuan to a seller’s bank account, then the seller sends Bitcoin or USDT to their digital wallet. Both sides verify with screenshots, phone calls, even voice notes.

Some users turn to privacy coins like Monero (XMR), which hide transaction details. Others use DeFi apps through modified browser extensions or custom Android apps like 'CryptoBridge' and 'Silk Road Wallet'. These apps don’t appear on official stores. They’re downloaded from third-party sites - and over 8.7 million times in the first half of 2025 alone.

Why Do People Keep Using Crypto When It’s Illegal?

It’s not about speculation alone. For many, crypto is practical.

Stablecoins like USDT are the most popular. Why? Because they let people send money overseas without going through banks. One user on a WeChat crypto forum said: "Sending USDT to my daughter in Australia saves me 87% in fees compared to Western Union. It takes 15 minutes, not three days." China has strict capital controls. You can’t easily move more than $50,000 abroad per year. Crypto bypasses that. For families with relatives overseas, students paying tuition, or freelancers getting paid in USD, crypto is the only reliable option.

Others use it to hedge against inflation. While China’s official inflation is low, real costs - housing, education, healthcare - keep rising. Young people see Bitcoin and Ethereum as stores of value, not just gambling chips. A 2025 Peking University study showed that 37.5% of crypto users are between 25 and 34. That’s higher than the global average. Older generations? Only 12.8% use it. This is a youth-driven movement.

The Government’s Double Game

Here’s the twist: while cracking down on crypto, China is quietly building its own digital currency system.

The e-CNY, or digital yuan, has over 260 million individual wallets and 15.5 million corporate wallets. It’s used for public transport, utility bills, and even salary payments to civil servants in pilot cities. The People’s Bank of China (PBoC) says it’s about efficiency, financial inclusion, and control.

But here’s the irony: the e-CNY is centralized. Every transaction is tracked. The government knows who paid whom, when, and how much. Crypto, by contrast, is anonymous - at least enough to slip past surveillance.

The government doesn’t want private digital money. It wants digital money it can control. That’s why it bans Bitcoin but promotes the e-CNY. One is a tool for citizens. The other is a tool for the state.

Two people trading crypto via P2P in a Beijing subway, exchanging cash for digital wallet codes.

Who’s Getting Caught - And Who’s Getting Away?

The crackdown is real. In July 2025, China’s State Administration of Foreign Exchange shut down 27 P2P platforms accused of enabling capital flight. Banks froze 1,287 accounts. Fines hit 237 million CNY ($32.6 million).

But enforcement is uneven. Most targets are large operators - crypto ATMs, fake exchanges, organized groups running scams. Individual traders? Rarely pursued unless they’re moving millions.

A Reddit survey from r/CryptoChina showed 68% of users had experienced account freezes due to crypto activity. The average loss? 23,500 CNY ($3,250). But 82% said they kept trading. Nearly half increased their investment in 2025 compared to 2024.

Why? Because the risks feel manageable. Most users keep small amounts. They avoid big transfers. They use multiple wallets. They never link crypto activity to their real identity. And they know: if one account gets frozen, they just open another.

The Hong Kong Factor

Hong Kong is the legal gateway. While mainland China bans crypto, Hong Kong allows licensed exchanges. As of June 2025, seven exchanges are approved, including HashKey and OSL. Together, they processed $14.3 billion in monthly trading volume in April 2025.

Many mainland users use Hong Kong accounts. They send money through informal channels - cash deposits, third-party agents, or even underground money changers. Once the funds are in Hong Kong, they can trade legally. The border is porous. The rules are different. And for many, Hong Kong is the only safe place to trade crypto without fear of jail.

Contrast between China's tracked e-CNY system and decentralized crypto in geometric shapes.

What’s Next? The Softening Signal

The government still says crypto is illegal. But behind closed doors, things are changing.

In July 2025, Shanghai’s State-Owned Assets Supervision and Administration Commission released meeting minutes suggesting a possible shift. One official noted: "The rapid evolution of digital assets necessitates more nuanced regulatory approaches." That’s not an official policy change. But it’s a crack in the wall. Analysts at Bernstein predict a 65% chance China will adopt a model like India’s - taxing crypto at 30% instead of banning it - by 2027.

Meanwhile, blockchain technology is still being tested in finance. In June 2025, 14 major Chinese banks launched a pilot program in the Shanghai Free Trade Zone using blockchain for cross-border trade settlements. The government doesn’t want crypto. But it wants the tech behind it.

Real People, Real Risks

On Zhihu, China’s version of Quora, a thread titled "How to safely trade crypto in China 2025" got over 14,000 upvotes. The top answer? A six-step verification process: check the buyer’s WeChat history, confirm their phone number, use a temporary SIM card, screen their bank statement, record the transaction, and wait 24 hours before releasing funds.

It’s not glamorous. It’s not easy. But it works.

The cost? Fraud is rampant. In Q1 2025 alone, Chinese users lost 1.2 billion CNY ($165 million) to crypto scams. Fake wallets, phishing links, fake P2P escrow services - they’re everywhere.

But for many, the risk is worth it. Crypto isn’t just money. It’s freedom. Freedom from state control. Freedom to move value. Freedom to invest outside a system that doesn’t trust them.

Final Thought: The Great Firewall of Crypto

China thought it could shut down crypto. It didn’t. Instead, it forced users to become smarter, more cautious, more creative. Chinese crypto users now have some of the most advanced evasion techniques in the world.

The ban didn’t kill crypto. It made it more resilient.

And as long as capital controls stay in place, as long as young people feel locked out of global financial systems, crypto will keep growing - quietly, secretly, stubbornly - in the shadows of the Great Firewall.

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19 Comments

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    Jon Visotzky

    December 6, 2025 AT 13:29
    so china bans crypto but everyone just uses vpn and wechat to trade?? honestly that's wild. they thought they could stop it but all they did was make it cooler. i'm not surprised tbh
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    Isha Kaur

    December 8, 2025 AT 02:37
    this is actually one of the most fascinating examples of grassroots resilience i've seen in recent years. it's not just about money-it's about autonomy. when people are locked out of global financial systems, they don't just accept it. they build alternatives. the p2p networks in china are basically decentralized banking systems built on trust, screenshots, and voice notes. it's low-tech but incredibly effective. and the fact that it's mostly young people doing this? that tells you everything about where the future is headed.
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    Glenn Jones

    December 10, 2025 AT 01:22
    ok but let's be real-this is just a glorified money laundering scheme with extra steps. the government is right to shut this down. you think usdt is "freedom"? it's a crypto loophole for the rich to sneak cash out while normal people get fined for sending 5k to their cousin. also why is everyone acting like this is some revolutionary act? it's not. it's just illegal. and if you're dumb enough to get caught, you deserve to lose your money
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    Krista Hewes

    December 10, 2025 AT 12:16
    i know someone who got her account frozen last year trying to send usdt to her sister in canada for tuition. she lost 15k cny but still trades now. she says it's the only way she can afford to help her family. it's not about speculation-it's survival
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    Mairead Stiùbhart

    December 12, 2025 AT 07:01
    oh wow so the chinese government banned crypto... and then everyone just became crypto ninjas? brilliant. next they'll be teaching kids how to use tor in kindergarten. honestly i'm impressed. the ban didn't kill crypto-it turned 59 million people into cybersecurity hobbyists
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    Tara Marshall

    December 13, 2025 AT 00:24
    p2p trading via wechat is the real story here. no exchange. no regulation. just two people trusting each other with screenshots and phone calls. it's primitive but it works. the escrow systems are surprisingly robust. most scams are caught within hours because the community polices itself
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    Richard T

    December 14, 2025 AT 19:31
    the e-cny is the real story. it's not about banning crypto-it's about replacing it with something the state can track. every transaction logged. every dollar monitored. crypto gives people anonymity. e-cny gives the government control. that's the entire game
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    jonathan dunlow

    December 16, 2025 AT 02:52
    i've been following this for years and honestly the most underrated part is how young people are using crypto as a hedge against inflation. housing prices, education costs, healthcare-it's all rising while wages stay flat. bitcoin isn't a gamble to them. it's insurance. and the fact that they're doing it without any formal training? that's the real innovation
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    Mariam Almatrook

    December 16, 2025 AT 14:26
    It is profoundly disconcerting to observe the normalization of illicit financial behavior under the guise of "freedom." The romanticization of circumventing sovereign monetary policy is not only irresponsible-it is a direct affront to the rule of law. One cannot selectively adhere to economic norms based on convenience. The state maintains authority for a reason.
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    rita linda

    December 17, 2025 AT 15:29
    this is why westerners are so naive. china isn't "oppressive"-it's protecting its economy. you think letting people move money out freely is good? look at argentina. look at turkey. crypto is a tool for capital flight. and capital flight = economic collapse. the government is doing its job. the users are just being reckless
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    michael cuevas

    December 18, 2025 AT 12:30
    lol imagine being so broke you need to use wechat to trade usdt but still think you're some rebel hacker. you're not a freedom fighter. you're a guy who got scammed twice and still keeps going. respect the hustle i guess
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    Nina Meretoile

    December 19, 2025 AT 08:39
    this is why i love tech-when governments try to control it, people just get smarter 💪🌍. the fact that a factory worker in guangdong can send money to australia in 15 mins using crypto? that's not illegal. that's human ingenuity. china wants control? fine. but you can't control what people do when they're trying to take care of their families
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    sonia sifflet

    December 20, 2025 AT 06:45
    you all are missing the point. this isn't about freedom. it's about ignorance. most of these people don't even know how blockchain works. they just see "usdt" and think it's magic money. they get scammed every day. the real problem is the lack of financial literacy. banning crypto is stupid-but letting uneducated people trade it without warnings? that's criminal
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    Elizabeth Miranda

    December 21, 2025 AT 13:59
    the most telling detail is that older generations barely use it. this is a youth movement. it's not about money. it's about identity. these kids are saying: we don't trust your system. we don't want your digital yuan. we want something outside your control. and they're building it with wechat and vpn. that's powerful
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    Annette LeRoux

    December 23, 2025 AT 08:59
    the fact that they're using modified android apps like 'CryptoBridge' and downloading them from third-party sites... that's next-level. these aren't hackers. they're regular people. students. parents. teachers. they're not trying to overthrow the state. they just want to send money to their kids without paying 30% in fees. that's not rebellion. that's basic human need
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    Madison Agado

    December 23, 2025 AT 12:49
    what's more ironic than banning crypto while building a surveillance currency? it's like outlawing bicycles because you want everyone to drive electric cars you can track. the government isn't fighting technology. it's fighting the idea that people deserve privacy. and that's a battle they can't win
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    Noriko Robinson

    December 23, 2025 AT 20:45
    i've lived in both the us and china. the resilience here is real. people aren't just breaking rules-they're rewriting them. the p2p networks, the voice note confirmations, the temporary sims-it's all so human. this isn't crypto. it's community. and no firewall can stop that
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    Roseline Stephen

    December 24, 2025 AT 21:01
    i appreciate the depth of this post. the cultural and economic layers here are complex. but i wonder-what happens when one of these users gets arrested? does the community rally? or do they just vanish and start again with a new phone?
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    jonathan dunlow

    December 26, 2025 AT 06:22
    i think the real win here is that the government is quietly adopting blockchain for cross-border trade. they don't want crypto. but they want the tech. that means they know it's inevitable. they're just trying to control the narrative. smart move. but the people? they're already two steps ahead

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