In 2021, the People’s Bank of China (PBOC) banned cryptocurrency transactions, citing concerns about financial stability and illicit activities. This marked a major shift for a country once a global leader in cryptocurrency adoption.
The ban has significantly limited the direct usage of digital currencies in mainland China, making it challenging for individuals to spend their crypto assets.
Interestingly, despite these restrictions, China’s engagement with cryptocurrencies remains notable. According to Triple-A, China ranks 20th globally in crypto adoption, with an estimated 78 million people (about 5.5% of the population) owning cryptocurrency. This statistic shows the Chinese population’s sustained interest in digital currencies, even in the face of regulatory challenges.
While spending cryptocurrency in China is not straightforward, there are still opportunities to use digital assets through specific channels. This guide reveals the best places to spend cryptocurrencies in the country.
The Rise of Cryptocurrency in China
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In the early years of cryptocurrency, China was one of the most influential players in the global crypto scene. By 2018, over 70% of the world’s Bitcoin was mined in China. This was largely due to its low electricity costs and advanced technology infrastructure. Cities like Shenzhen and Hangzhou became hubs for blockchain companies and crypto innovation, drawing global attention.
Millions of Chinese citizens adopted cryptocurrencies, using them for investment and as a means of payment. Popular platforms like Huobi and Binance, which started in China, became major global crypto exchanges. At the time, the country was a leader in both mining and trading activities.
The Crackdown on Cryptocurrencies
However, In 2017, China began restricting cryptocurrencies by banning Initial Coin Offerings (ICOs) and shutting down domestic exchanges.
The government expressed concerns over fraud, money laundering, and the impact on financial stability. This regulatory pressure peaked in 2021 when the People’s Bank of China (PBOC) declared all crypto transactions illegal, banning them entirely within the country.
According to the People’s Bank of China, “Virtual currency-related business activities are illegal financial activities,” warning that it “seriously endangers the safety of people’s assets.
This led many crypto businesses to relocate to other countries like the United States and Singapore. Mining activities also shifted, with firms setting up operations in places like Kazakhstan and Canada.
However, despite the ban, interest in cryptocurrencies has not disappeared in China. Even with strict regulations, people in China have found ways to use cryptocurrencies.
Best Places to Spend Crypto in China
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Despite the regulatory restrictions on cryptocurrency in mainland China, there are still ways to spend your digital assets within and in neighboring regions. Let’s break down some practical and accessible options.
1. Travel and Accommodation Services
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Travel is one area where cryptocurrencies can still be used, especially for international bookings. Even though direct cryptocurrency payments are not commonly accepted in China, travel booking platforms that accept crypto make it possible for Chinese users to use their digital assets for international travel.
For example, platforms like Travala.com and Alternative Airlines allow users to book flights, hotels, and other travel-related services with cryptocurrencies. These services support popular coins such as Bitcoin, Ethereum, and others, offering an easy way to convert your crypto into something practical—whether it’s booking a flight to a destination or reserving a hotel room.
Even though China has strict regulations on crypto, these international platforms remain accessible to Chinese users who wish to travel and use their digital assets to fund their journeys.
2. E-commerce Platforms via Gift Cards
In mainland China, platforms like JD.com or Taobao, which dominate the e-commerce scene, do not directly accept cryptocurrencies. However, you can still use your crypto to make purchases on these sites by buying gift cards.
For example, platforms like Upay or Coinsbee allow you to buy or convert cryptocurrency into gift cards for popular services like Amazon, Spotify, Netflix, and even gaming platforms like Steam. These gift cards can then be used for shopping on major e-commerce platforms, effectively allowing you to spend crypto even though direct transactions aren’t possible.
Additionally, Bitrefill lets you purchase eSIMs, airtime, and other digital services with Bitcoin, Ethereum, and other cryptocurrencies. This is an excellent workaround for those who want to use their digital assets for online shopping. By converting your crypto into a gift card, you can shop for products, stream music, or buy entertainment services, all with your cryptocurrency
3. Food and Beverage Services
While cryptocurrencies are still not widely accepted in the food and beverage industry in China, the global trend of integrating crypto into loyalty programs and payment systems is growing. Internationally, some restaurants are already accepting Bitcoin and other cryptos as payment.
For instance, in cities outside of China, Okra Hong Kong, a popular restaurant, began accepting payments in Bitcoin and Ethereum. While this service is not yet widespread in mainland China, it shows a promising future for crypto in food and beverage establishments.
4. Payment Platforms
While China is known for its advanced digital payment systems, such as Alipay and WeChat Pay, some platforms cater specifically to cryptocurrency transactions. Upay is one such service, enabling businesses to accept cryptocurrency as payment for goods and services.
However, because of regulations in China, using the platform can be tricky. Even so, it shows how cryptocurrency can be used for everyday transactions in places with fewer restrictions.
Meanwhile, in other countries, Upay lets users spend cryptocurrency at many online stores, making it easy to use digital coins for shopping. This idea could eventually reach China through global businesses that support cryptocurrency and work with platforms like Upay.
5. Blockchain and NFT Games
Blockchain games and NFT (Non-Fungible Token) games provide an avenue for Chinese users to engage in crypto-based gaming. These games are decentralized, and users can spend crypto on in-game assets such as characters, skins, or virtual property. These assets can be traded for other cryptocurrencies or used within the game.
6. Peer-to-Peer (P2P) Transactions
Despite the ban, a gray market for cryptocurrency transactions still exists in China. Many individuals engage in P2P trading, where you can exchange cryptocurrencies directly with other users. While this method allows you to spend crypto, it’s important to exercise caution, as it operates in a legal gray area and carries significant risks, including fraud and potential legal consequences.
Tips for Spending Cryptocurrency in Canada
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1. Use Gift Cards and Vouchers
You can buy or convert cryptocurrencies into gift cards or vouchers through platforms like Upay, Coinsbee, and Bitrefill. These vouchers can be used at major retailers such as Amazon, JD.com, and Apple, allowing you to indirectly spend your crypto on everyday goods.
2. Explore P2P Trading
Despite the ban, a gray market for crypto transactions exists. You can engage in peer-to-peer (P2P) trading, where cryptocurrencies are exchanged directly between users. Popular platforms like LocalBitcoins and Paxful provide a space for users to buy and sell crypto, though it’s essential to be cautious due to potential risks like fraud.
3. Take Advantage of Global Platforms
While crypto spending is restricted in mainland China, you can use international platforms like Travala to book flights, hotels, and travel services with cryptocurrencies. This offers a practical way to use your digital assets for travel even if you’re in China.
4. Purchase Digital Services
Platforms such as Bitrefill allow you to use crypto to purchase digital services, including airtime, eSIMs, and subscription services. You can use cryptocurrencies like Bitcoin and Ethereum to pay for mobile data or internet services directly.
5. Shop at Crypto-Friendly Businesses in Hong Kong
If you’re located near Hong Kong, you can visit businesses that accept cryptocurrency payments. For example, restaurants like Okra Hong Kong accept Bitcoin and Ethereum, allowing you to enjoy a meal with your crypto, even if you’re in the region’s more crypto-friendly environment.
6. Stay Informed About Regulatory Changes
Cryptocurrency regulations in China are continuously evolving. Make sure to stay updated on any new legal developments or adjustments to avoid unintentional legal trouble. Following news and updates on official platforms can help you stay informed about the latest regulatory changes.
Challenges of Spending Crypto in Canada
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1. Regulatory Restrictions
China has strict regulations that prevent the direct use of cryptocurrencies for payments. For example, major platforms like Alipay and WeChat Pay do not support crypto transactions, making it hard for crypto holders to spend their assets directly. The ban on crypto exchanges and ICOs also adds to the challenges.
2. Limited Acceptance of Crypto Payments
While some businesses globally accept cryptocurrency, the majority of businesses in China still do not. For instance, in cities like Beijing and Shanghai, even tech companies often do not accept payments in Bitcoin or Ethereum, limiting where you can spend your crypto locally.
3. Legal Risks with Peer-to-Peer (P2P) Trading
Although P2P trading offers a way to exchange and spend crypto, it operates in a legal gray area. This means engaging in P2P exchanges comes with potential risks, such as fraud or legal action. Many users have reported scams where sellers did not fulfill their part of the transaction, leading to financial losses.
4. Currency Volatility
Cryptocurrencies are known for their volatility, which makes spending them in daily transactions risky. For example, the price of Bitcoin can change drastically within hours, meaning the amount of crypto you spend today might be worth significantly more or less tomorrow.
5. Difficulty in Converting Crypto to Fiat Currency
Converting cryptocurrency to traditional currency, such as the Chinese Yuan (CNY), is difficult due to the restrictions in place. Without a proper exchange service available in China, people often rely on international platforms, which can involve additional fees and long processing times.
6. Limited Crypto-Friendly Services
Many everyday services, such as groceries or public transport, do not accept crypto payments in China. For example, you won’t find many restaurants or supermarkets where you can directly pay with Bitcoin or Ethereum, forcing crypto holders to use alternative payment methods.
Read Also: Best Places to Spend Crypto in Brazil
Conclusion
While cryptocurrency use in China faces challenges due to bans and strict regulations, there are still ways to spend it through indirect methods. Similarly, with new global appeals, regulations, and increasing crypto-friendly businesses, spending digital assets in China may become easier in the future, aligning with global trends of crypto integration.
Frequently Asked Questions
Spending cryptocurrency in China is challenging due to strict regulations, but indirect methods and specific avenues exist.
Yes, China has banned cryptocurrency trading and mining, but holding and using digital assets in specific ways is still possible.
In regions with flexible rules, cryptocurrencies can be spent at online retailers and physical stores through specialized platforms.
Regulatory restrictions make it difficult to use cryptocurrencies, limiting their adoption for everyday transactions directly.
UPay is a leading crypto platform that provides secure and convenient global payment services.
