Despite the prohibition on cryptocurrency in China, the country stands as the largest market for the renowned digital currency exchange, Binance. As per details disclosed to the Wall Street Journal, Binance registers an estimated 900,000 active users based in China. This comes as an intriguing revelation, considering the stringent restrictions China has placed on the crypto industry.
The exchange sees not only China as its leading user base but also South Korea, Turkey, Vietnam, and the British Virgin Islands strong contributors to its market. The total value of the futures market in China for Binance is estimated to be a hefty $80.6 billion, accompanied by $9.4 billion in the spot market. South Korea is not far behind with a $56.9 billion futures volume and $1.39 billion spot volume.
Interestingly, it appears that traders in China are keen on the adoption of novel technologies to overcome established hurdles. In order to move past the geographic restrictions plaguing the area, individuals often utilize a combination of a Virtual Private Network (VPN) and a digital residency program such as Palau’s RNS.ID.
In addition to its substantial volume of users, Binance continues to maintain an active peer-to-peer crypto market, enabling trading Chinese yuan-denominated pairs and facilitating fiat onramps via Alipay and WeChat pay. This provision is significant in a nation with such hard-line restrictions on digital assets.
However, the disclosure of China being the key market for Binance raises some serious questions. Despite their dynamic approach allowing them to bypass limitations, the Chinese population participating in crypto trading must face genuine concerns over the legality and security of their investments in the light of regulatory hostility. Contrastingly, it is worth noting that Binance routinely collaborates with the Chinese authorities to detect potential illicit activities.
To conclude, while the Chinese masses and Binance appear to be maintaining a symbiotic relationship, the long-term feasibility of this association remains in uncertain territory. User adherence to alternative methods for accessing crypto trading and Binance’s established groundwork in the nation may act as a counterbalance to the hefty regulations in place. Thus, in the grand scheme, China’s undeniable impact on Binance’s market despite a hostile environment poses an interesting scenario.
Source: Coindesk
