China's crypto ban seems to be a sham, foreign media reports: 20% of Binance's trading volume comes from China, working closely with regulators.

Despite China's ban on cryptocurrencies, according to The Wall Street Journal, citing internal data from Binance, Chinese retail investors accounted for 20% of Binance's total trading volume in May. Binance has even collaborated with Chinese regulators to investigate whether active users are engaged in any illegal activities.

Chinese Retail Investors Account for 20% of Binance Trading Volume

The Wall Street Journal cited internal data viewed by current and former employees of Binance indicating that Chinese users traded $90 billion in cryptocurrency in May, accounting for 20% of global trading volume, excluding large institutional trades.

In China and other restricted countries, registration and trading on exchanges are mainly conducted through VPNs. Apart from Chinese users holding a significant portion, the next largest contributors are South Korea at 13%, Turkey at 10%, and Vietnam.

Note: In May 2021, China imposed a comprehensive ban on cryptocurrency trading and related activities, altering the global landscape of Bitcoin mining power.

Binance Continues to Collaborate Closely with Chinese Law Enforcement to Investigate Illegal Activities by Chinese Users

It cited Binance employees stating that the exchange discusses the importance of a large number of Chinese users internally.

Despite the ban, Chinese officials seem to take a lenient approach to the crypto ban, and Binance's investigations team still closely collaborates with Chinese law enforcement to investigate potential illegal activities among over 900,000 active users in China.

Approximately 100,000 Chinese users are classified as "politically exposed persons (PEP)," and banks and regulatory agencies mark government officials and their relatives as such because they are more likely to be involved in bribery, corruption, or money laundering, requiring stricter scrutiny.

The report also cited data from various institutions to support the findings:

• Chainalysis: China's ban led to a temporary decrease in trading volume, but China remains the fourth-largest cryptocurrency trading market globally.

• Mission Control: Binance's Chinese user trading volume dropped from 24% to 17% after the ban but rebounded after 2022.

• Mission Control: Binance has 5.6 million Chinese users, with 911,650 being active users.

Note: Former employees referred to Mission Control as the internal data platform name at Binance.

A Binance spokesperson told The Wall Street Journal that Binance.com is blocked in China, and Chinese users cannot access it.