Crypto in China: What's Legal, What's Banned, and How It Really Works

When you hear crypto in China, the Chinese government’s strict stance on digital assets that bans trading, mining, and exchange services. Also known as cryptocurrency restrictions in China, it’s not a simple ban—it’s a complete system shutdown designed to protect the yuan and control financial flows. Since 2021, China has shut down all domestic crypto exchanges, blocked mining operations, and cracked down on peer-to-peer trading. But here’s the twist: people still use Bitcoin and other coins—just not the way you’d expect.

The real story isn’t about prohibition—it’s about adaptation. While banks can’t process crypto transactions, millions of Chinese citizens use over-the-counter (OTC) traders, individuals or small groups who buy and sell crypto directly for cash or bank transfers. Also known as P2P crypto networks, they operate quietly through messaging apps like WeChat and Telegram, often using trusted intermediaries to avoid detection. These aren’t hackers or criminals—they’re ordinary people trying to protect savings from inflation, send money abroad, or access global markets when traditional banking fails. And it’s not just individuals. Some Chinese companies quietly hold crypto as a hedge, using offshore wallets and layered transactions to stay under the radar.

What about crypto mining, the process of validating blockchain transactions using powerful computers, once dominant in China due to cheap hydroelectric power. Also known as Bitcoin mining China, it was responsible for over 70% of global Bitcoin mining before the 2021 crackdown. The government didn’t just turn off the lights—it reclassified mining as an energy waste. Factories in Sichuan and Xinjiang were shut down overnight. But mining didn’t disappear—it moved. Thousands of rigs were shipped to Kazakhstan, the U.S., and even Russia. Some miners stayed, running hidden operations in rural areas or disguised as data centers. The Chinese state still monitors energy use closely, so any large-scale mining today is either illegal or heavily controlled.

And then there’s the digital yuan—the government’s own blockchain-based currency. It’s not crypto. It’s the opposite: fully traceable, centrally controlled, and mandatory for many transactions. The government uses it to track spending, reduce cash reliance, and bypass Western financial systems. In many ways, the digital yuan was built to replace the need for Bitcoin, not coexist with it.

So what does this mean for you? If you’re outside China, you might think crypto is dead there. It’s not. It’s just underground. If you’re inside China, you’ve learned to navigate it without drawing attention. The rules are strict, but the demand is real. People still need access to global value, and they’ve found ways—clumsy, risky, but effective.

Below, you’ll find real reviews, case studies, and breakdowns of how crypto works in places with heavy restrictions—from Cuba to Nigeria, and yes, even China. You’ll see how people adapt, what tools they use, and what happens when governments try to control money that was built to be free.