In 2021, China decisively moved against cryptocurrencies, leading to a mass exodus of miners from the country. The resulting drop in mining power was quickly mitigated by miners relocating to regions like the USA and Kazakhstan. Despite this stringent stance, China has permitted Hong Kong to develop its cryptocurrency sector.
China’s Cryptocurrency Stance
A study by Hong Kong-based TechFlow reveals that the Binance exchange remains the preferred platform for Chinese-speaking cryptocurrency investors. This continued engagement occurs despite the Chinese government’s ban on cryptocurrency activities. The data also indicate significant usage of alternative centralized exchanges.
The survey shows 96.72% of respondents use Binance, with 63.15% holding most of their assets there. Additionally, many participants rely on other exchanges simultaneously, demonstrating a diverse exchange usage pattern.
For instance, 83.53% maintain an account with OKX, and 25% keep assets there. Other centralized exchanges also see considerable account registrations, with rates exceeding 35%.
Cryptocurrency Trading in China
Interestingly, over 25% of survey participants trade cryptocurrencies full-time, and nearly 50% store more than half of their savings in digital assets. The most popular cryptocurrencies among Chinese investors include:
- BTC
- ETH
- SOL
- BNB
- PEPE
Furthermore, a significant portion of investors (40.04%) exhibits metaphysical behaviors such as praying for financial success, underscoring the cultural nuances in investment practices.
Key Insights for Investors
Based on the findings, several valuable insights can be drawn for cryptocurrency investors:
- Chinese investors are resilient and adaptive to regulatory challenges.
- Binance remains a dominant exchange despite the governmental ban.
- Diversification across multiple exchanges is a common practice.
- Cultural factors significantly influence investment decisions.
Between 2022 and June 2023, $86.4 billion in transactions were recorded in the Chinese market, according to a Reuters report based on Chainalysis data. This underscores that China continues to be a major player in the global cryptocurrency landscape.
