Laundromats & Cafes: The Unlikely Hubs for China's Illegal Crypto Activities

• Crypto Trading in China Continues Despite Ban
• Social Media as Trading Platforms
• Physical Trading in Inland China
• People's Bank of China's Crypto Ban
• Implications for Other Countries

Crypto Trading in China Continues Despite Ban

Chinese crypto users have found various ways to trade, despite the country's stringent ban on such transactions, as per information gathered from Wall Street Journal. These traders tend to conduct their business in public areas ranging from cafes and snack kiosks to laundromats, exchanging wallet addresses or arranging for bank transfers. Physical transactions for cryptocurrencies are also a common occurrence.

Social Media as Trading Platforms

According to the same report, social media applications like WeChat and Telegram have been used as platforms for cryptocurrency transactions. These apps have dedicated groups that enable buyers and sellers to conduct business without the need for a traditional exchange.

Physical Trading in Inland China

The prevalence of physical trading is particularly noticeable in the inland regions of China. These areas, typically economically disadvantaged and far from the coast, have local governments that are more focused on other issues, resulting in less enforcement of the central bank's crypto ban.

People's Bank of China's Crypto Ban

It was in 2021 when the People's Bank of China (PBOC) deemed all crypto-related activities unlawful. Subsequently, cryptocurrency exchanges ceased to permit mainland China citizens to create accounts on their platforms. Despite these measures, over-the-counter (OTC) trading volume in the country reached an impressive $86.4 billion in 2023, as per data from blockchain intelligence firm Chainalysis.

Implications for Other Countries

If cryptocurrency trading can survive and even thrive under authoritarian regimes like China, it could potentially deter other jurisdictions considering stringent regulation of cryptocurrency trading in the years to come.

Edited by Jonathan Stoker