Legal Crypto China 2025: What's Allowed, What's Not, and How Traders Adapt

When it comes to legal crypto China 2025, the Chinese government’s stance remains strict: no exchanges, no banking support, no public trading platforms. Also known as crypto prohibition in China, this policy doesn’t mean crypto disappeared—it just went underground. The People’s Bank of China (PBOC) shut down domestic exchanges in 2021, blocked crypto-related ads, and pressured banks to freeze accounts tied to digital assets. But the market didn’t die. In 2025, an estimated $86.4 billion in crypto trades still happen each year inside China, mostly through peer-to-peer (P2P) channels and offshore platforms.

What’s actually legal? Holding crypto in a personal wallet is not illegal. Sending crypto to a friend via WeChat or Alipay using a P2P platform like LocalBitcoins or Paxful isn’t a crime—unless you’re running a business or advertising it. The line is blurry: owning Bitcoin is fine; selling it for yuan without a license isn’t. PBOC crypto rules, the official regulations enforced by China’s central bank. Also known as digital currency restrictions, they focus on preventing capital flight and maintaining control over the yuan. Meanwhile, underground crypto China, the hidden network of traders using cash, gift cards, and encrypted apps to move digital assets. Also known as black market crypto, this ecosystem thrives because people still need access to global markets, inflation protection, and remittance options. Many traders use VPNs to access foreign exchanges, then convert crypto to yuan through trusted contacts—often in person, in parking lots or coffee shops.

Why does this still work? Because China’s 1.4 billion people aren’t all on the same page. Young professionals, tech workers, and small business owners see crypto as a way to preserve wealth amid economic uncertainty. They don’t need a bank to hold Bitcoin—they need a phone and a contact. The government knows this. They crack down on large operators and advertising, but they can’t monitor every private transfer. Enforcement is selective, not total. And with no clear path to legalization, the underground market stays resilient.

What you won’t find in China are regulated exchanges like Binance or Coinbase. You won’t see crypto ATMs. You won’t get a crypto debit card from a Chinese bank. But you will find people trading on Telegram groups, using escrow services, and paying in USDT for goods and services. The risk is real—accounts get frozen, arrests happen, and scams are common. But for many, the payoff is worth it.

Below, you’ll find real stories from inside China’s hidden crypto economy: how traders bypass restrictions, what tools they use, the scams to avoid, and why this market isn’t going away—even if the laws never change.