When you hear crypto in China, a financial system where digital assets are officially banned for trading, mining, and exchange services, yet quietly thrive through underground networks and cross-border workarounds. Also known as China’s underground crypto economy, it’s not about rebellion—it’s about survival. In 2021, China shut down all cryptocurrency exchanges, banned mining operations, and froze bank accounts tied to crypto activity. The government didn’t just discourage it—they made it illegal to operate any platform that connects buyers and sellers. But the money didn’t disappear. It moved.
What happened next was unexpected. Thousands of miners packed up their rigs and moved to Kazakhstan, Russia, and the U.S.—but not because they gave up. They were chasing cheaper electricity and fewer rules. Meanwhile, regular people in cities like Shanghai and Guangzhou kept using crypto through peer-to-peer apps, hardware wallets, and offshore exchanges. They weren’t trading Bitcoin on Binance—they were buying it from strangers in parking lots, using WeChat to send USDT in exchange for cash. This isn’t fantasy. It’s daily life for millions who see crypto not as speculation, but as a shield against currency devaluation and capital controls.
Even mining didn’t die. It just got smarter. Some farms stayed hidden in rural areas, powered by surplus hydroelectricity that the state couldn’t monitor. Others turned into legal mining cooperatives—officially licensed, but quietly exporting their hash power through third-party networks. The government still cracks down randomly: last year, a mining operation in Sichuan was raided after using 120 megawatts of grid power. The owners got fined, their machines seized. But the next week, another farm popped up 200 miles away.
And then there’s the wallet problem. If you can’t use a centralized exchange, how do you hold your coins? Most Chinese crypto users rely on non-custodial wallets like Trust Wallet or Ledger. They don’t trust apps that ask for ID. They don’t trust platforms that could freeze their funds overnight. They keep their private keys on paper, in safe deposit boxes, or buried in steel containers. Losing your key means losing everything—no customer service, no recovery option, no government backup.
What you won’t hear in Western headlines is how deeply this affects everyday life. A factory owner in Zhejiang uses Bitcoin to pay suppliers overseas because the yuan’s value drops too fast. A student in Chengdu earns crypto by running a node for a decentralized project—paid in ETH, not yuan. A doctor in Wuhan stores emergency savings in USDT, knowing the local bank might freeze accounts if the economy tanks again.
This isn’t about getting rich quick. It’s about keeping what you have. And that’s why crypto in China isn’t going away—it’s just going underground. The rules are strict, the risks are high, but the need is real. What follows are real stories from people who’ve figured out how to play the game under the radar. You’ll read about exchanges that work despite the ban, mining setups that survive government raids, and wallets that keep fortunes safe when everything else fails. This isn’t theory. It’s what’s happening right now.
Despite a total ban since 2021, 59 million Chinese citizens still use cryptocurrency through hidden P2P networks, VPNs, and encrypted apps. Here's how they do it - and why the government can't stop them.