P2P Transfers

East Asia’s five largest crypto markets now represent a combined $1.2 trillion in activity, with China’s underground stablecoin economy expanding even as Beijing’s trading ban stays in force. A new dataset shows the gap between written law and actual usage is widest in China, where peer-to-peer stablecoin wallets grew 43 times in roughly two years, a divergence that matters for institutions trying to price regulatory risk across the region.

• China’s crypto economy is worth at least $176.3 billion despite a multi-year trading ban still in effect.
• Hong Kong issued its first two stablecoin licenses to HSBC and Anchorpoint on April 10, 2026, but neither has a trading venue yet.
• South Korea’s $449.1 billion market faces a 22% capital gains tax set for January 1, 2027, that lawmakers are trying to delay again.

• 43x growth in China’s peer-to-peer stablecoin wallet count, Q1 2024 to Q2 2026
• $1.2T combined size of East Asia’s five largest crypto markets
• 33.2x annual stablecoin turnover rate in China versus 9.3x global average

A Chainalysis report published today shows a gap in the existing crypto regulations across East Asia and the way trading is being run in real life. The widest gap sits in mainland China, where trading has been outlawed for years yet the underlying crypto economy is still worth a minimum of $176.3 billion. South Korea remains the region’s single largest market at $449.1 billion, as first detailed in a report by Cryptopolitan.

China’s Stablecoin Wallets Jump 43x as P2P Volume Hits $104.1 Billion

Chainalysis tracked 18.1 million self-custodied stablecoin transfers inside China worth $104.1 billion between July 2025 and June 2026. The number of distinct wallets sending peer-to-peer stablecoin transfers rose 43 times between the first quarter of 2024 and the second quarter of 2026, the sharpest divergence the firm recorded anywhere in the region.

Turnover hit 33.2 times a year, more than triple the global average of 9.3 times. Chainalysis reads that velocity as evidence users are treating stablecoins as operating cash rather than a store of value.

Domestic peer-to-peer transfers accounted for 59.1% of China’s total crypto activity, roughly 3.5 times their share a year earlier. March 2026 alone contributed $4.9 billion of that volume. Beijing has not eased enforcement to match: a February notice from the People’s Bank of China and seven other agencies banned unauthorized yuan-pegged coins both domestically and abroad, underscoring how a government can hold a prohibition in place while the on-chain economy it targets keeps expanding regardless, a dynamic that echoes debates elsewhere over how regulators define custody for digital assets.

HSBC and Anchorpoint Hold Licenses With No Venue to Trade On

Hong Kong’s $192.2 billion market stands out as the region’s most institutional, with 16% of inbound flows landing on institutional platforms, nearly three times the share seen in any neighboring market.

Of that institutional flow, 85% went to custody providers, prime brokers and market makers, while business-to-business flows totaled almost $24 billion and institutional platform receipts grew 87% over the year, the fastest pace in East Asia.

The Hong Kong Monetary Authority awarded its first two stablecoin issuer licenses to HSBC and Anchorpoint, a venture backed by Standard Chartered, HKT and Animoca Brands, on April 10, 2026. The pair was selected from 36 applicants under an ordinance that took effect in August 2025.

Neither issuer has a venue to trade its coin. The bill meant to license virtual-asset trading platforms is not due for review until later this year, leaving licensed issuance running ahead of the infrastructure needed to support it, a sequencing gap institutional allocators will need to track as closely as the custody frameworks taking shape elsewhere, including proposals like the CFTC’s recent call for comment on crypto trading rules.

South Korea’s Tax Fight Pits Han Dong-hoon Against a January 2027 Deadline

South Korea grew 12.3% over the period to $449.1 billion, driven by a 16.3% expansion in its exchange sector and $51.1 billion in additional exchange-related flows. The market remains overwhelmingly retail, and Chainalysis found Korean retail traders tilted harder toward AI-linked tokens than any other segment in the region.

A 22% capital gains tax, combining a 20% national levy and a 2% local charge on gains above 2.5 million won, is scheduled to take effect January 1, 2027, after repeated delays. Independent lawmaker Han Dong-hoon is pushing a further two-year postponement, arguing authorities still cannot track trading once assets leave domestic exchanges.

A petition backing the delay has already gathered the 50,000 signatures needed to trigger parliamentary review.

Japan’s $228.3 billion market shows a different pattern: decentralized exchanges account for 34.5% of service activity, the highest DEX share of any established market in a region otherwise dominated by centralized venues, and usage has more than tripled since 2022.

Most swaps, 65.7%, fell between $10 and $1,000, while crypto gains remain taxed as miscellaneous income at rates up to roughly 55% until the Financial Instruments and Exchange Act reclassifies crypto as a financial product in fiscal 2027, with the lower 20% flat rate not applying until January 1, 2028.

The CCS read. China’s enforcement gap is the real signal here, not Hong Kong’s licensing headlines. A regime that can quadruple P2P stablecoin turnover while maintaining a formal ban shows capital controls are losing grip on retail settlement rails, which should worry any institution modeling renminbi-adjacent stablecoin flows as containable rather than already dollarized at the margins.

Hong Kong’s licensing bill for virtual-asset trading platforms is due for review later this year, and until it passes, HSBC and Anchorpoint have licenses but nowhere for their coins to trade. South Korea’s National Assembly will decide whether to act on Han Dong-hoon’s delay push and the 50,000-signature petition before the January 1, 2027, tax deadline arrives.