China’s peer-to-peer stablecoin economy has expanded sharply despite the country’s longstanding restrictions on domestic crypto services. According to Chainalysis’ 2026 East Asia report, unique wallets sending P2P stablecoin transactions in mainland China increased 43-fold between Q1 2024 and Q2 2026. Chainalysis estimates the country’s measurable crypto economy reached at least $176.3 billion during the 12 months through June, while warning that activity suppressed or displaced by restrictions makes its true size difficult to measure.
China’s domestic P2P economy accounted for 59.1% of its estimated crypto activity, 3.5 times the previous period’s share. Stablecoins showed particularly intense turnover: Chainalysis estimates that $3.1 billion in average self-custodied stablecoin holdings supported $104.1 billion across 18.1 million transfers during the study period. That implies annual velocity of 33.2x, compared with a global average of 9.3x.
Stablecoins Behave More Like Working Capital in China
The velocity data suggest the same stablecoin balances are being repeatedly transferred rather than simply held as dollar-denominated savings. Japan recorded stablecoin velocity of 9.9x, Hong Kong 6.1x, South Korea 5.1x and Taiwan 3.5x. China’s substantially higher turnover is consistent with stablecoins functioning as transactional working capital, although blockchain data cannot by itself determine the purpose of every transfer or identify every individual behind a wallet.
Chainalysis observed a clear acceleration beginning around March 2025. Monthly additions to measured domestic stablecoin activity increased from roughly $240 million that month to nearly $5 billion a year later. Transfers across smaller value bands also grew sharply. The company notes that this timing coincided with China’s expansion of its social-credit framework into finance and internet activity, but explicitly presents that connection as a hypothesis. The onchain evidence establishes rapid P2P growth, not that a specific government policy caused users to migrate toward stablecoins.
That distinction is relevant as China continues maintaining a restrictive perimeter around private crypto activity. Recent domestic policy has also tightened around areas such as RWA tokenization deemed unauthorized by major Chinese financial associations. The latest Chainalysis data suggest restrictions can change where activity occurs without necessarily eliminating the underlying demand for digital settlement rails.
East Asian Markets Follow Different Paths
South Korea presents almost the opposite market structure. Chainalysis estimates a $449.1 billion crypto economy during the same July 2025-June 2026 period, up 12.3%, making it the largest measured market in East Asia. Its growth was predominantly retail-led, with AI-linked cryptocurrencies becoming the largest defined thematic category of won trading by June. South Korea’s activity remains concentrated around regulated exchanges rather than China-style domestic P2P rails.
That high activity did not translate into stronger exchange economics throughout the period. South Korea’s Financial Intelligence Unit separately found that exchange operating profit fell 78% in H1 2026 as average daily trading volume dropped 44%. The contraction is detailed in South Korea’s H1 exchange profitability data. Transaction activity, market size and exchange profitability are therefore separate measures and can move in different directions.
Hong Kong shows another configuration. Its measured crypto economy reached $192.2 billion, but institutional platforms captured 16% of service inflows, almost three times the share of any regional peer. Nearly $24 billion arrived through inbound business-to-business transfers, while cumulative net B2B inflows reached $17.4 billion by mid-2026. Hong Kong’s activity is increasingly concentrated inside regulated institutional channels, consistent with its broader effort to expand licensed digital-asset infrastructure beyond trading platforms.
Japan, meanwhile, recorded $228.3 billion in measured crypto activity and the region’s highest DEX share at approximately 34.5%. Chainalysis says Japanese DEX engagement has increased more than 200% since 2022 while centralized exchange activity remained broadly flat. Japan is therefore combining regulated institutional development with unusually strong consumer migration toward decentralized venues, rather than following either China’s P2P-heavy structure or South Korea’s exchange-centered model.
Outside East Asia, Singapore provides another useful comparison. Chainalysis separately measured $284 billion in activity during the same 12-month period, up 55.4%, including a 94% increase in institutional-platform activity. That expansion has been examined alongside Singapore’s increasingly institutional crypto market. Asia’s crypto markets are consequently not converging on a single model: P2P stablecoins, centralized retail trading, regulated institutional flows and DEX activity are expanding at materially different rates across jurisdictions.
For China, the strongest signal is not simply the $104.1 billion transfer figure but the relationship between balances and turnover. A relatively small pool of self-custodied stablecoins circulated at unusually high velocity despite restrictions on domestic crypto services. That makes P2P activity an increasingly important part of China’s measurable crypto economy, while leaving open the harder questions of who is transacting, why those transfers occur and how much activity remains invisible to blockchain attribution models.
