China: despite the ban, the use of stablecoins explodes from person to person

“Chase the natural, it comes back at a gallop,” wrote Destouches in Le Glorieux. China is experiencing this with stablecoins, which it has driven out the door and which are returning from person to person.

A total ban, and a market that is still growing. In China, the number of wallets that send stablecoins, these cryptocurrencies indexed to a classic currency, has multiplied by 43 in two years, according to the report on East Asia published this Monday, October 5 by Chainalysis. The central bank, however, reaffirmed its ban on cryptocurrencies at the end of November 2025, with twelve other administrations in support. You read that right, forty-three times.

Stablecoins in China: $104 billion under the radar

Chainalysis estimates China's crypto economy to be worth at least $176.3 billion between July 2025 and June 2026, according to its East Asia adoption report. The country comes fourth in the region, behind South Korea (449.1 billion), Japan (228.3 billion) and Hong Kong (192.2 billion).

The raw number matters less than its composition. Since exchange platforms are banned, money circulates directly between people, peer-to-peer. These domestic flows now represent 59.1% of the Chinese crypto economy, a share multiplied by 3.5 in one year.

And it turns out fast. Out of an average stock of $3.1 billion in owned stablecoins, Chinese users circulated $104.1 billion in 18.1 million transfers. Each dollar changes hands 33.2 times per year, compared to the global average of 9.3 times. An asset that we save does not move at this rate, a means of payment does.

Why Chinese peer-to-peer has taken off since March 2025

The report dates the changeover precisely. In March 2025, Beijing extends its social credit system to finance and the Internet. This system records behavior and can cut off access to credit, employment or banking services. The same month, transfers of less than $100 jumped by 996%.

The rest looks like a regular slope. Chinese peer-to-peer added around 240 million dollars per month in March 2025 and almost 5 billion a year later, after thirteen consecutive months of increase. Chainalysis puts forward two explanations. People placed on the blacklist would fall back on a circuit that no one can close to them. Others would simply seek to stay out of control screens, by displaying a property on an online commerce platform before paying for the sale via a crypto address exchanged on Telegram.

Be careful, all the same. Chainalysis itself speaks of a “working hypothesis” and recognizes that the Chinese market remains difficult to measure. The company also sells tracking tools to states, which gives some weight to its conclusion.

Ban or regulate stablecoins: Asia serves as a laboratory

This conclusion is contained in one sentence from the report: China banned crypto “and the activity simply shifted.” The neighbors made the opposite bet, that of the license.

In Hong Kong, where HSBC and Standard Chartered were in the running for the first stablecoin licenses, institutional platforms received 87% more funds year-over-year. The city has captured $17.4 billion in net institutional inflows since the end of 2024. In South Korea, the region's leading market with an increase of 12.3%, growth comes almost entirely from individuals, who are rushing into tokens linked to artificial intelligence.

The picture is not rosy everywhere. The region's crypto economy contracted slightly over the period, due to the bear market.