The number of unique wallets sending peer-to-peer stablecoin transactions in China grew 43-fold between the first quarter of 2024 and the second quarter of 2026, according to Chainalysis data, despite Beijing's continuing ban on cryptocurrency trading.

The blockchain analytics firm recorded $104.1 billion across 18.1 million transfers involving Chinese self-custodied stablecoin holdings during its 2026 reporting period, which ran from July 2025 to June 2026. Stablecoin holdings turned over 33.2 times per year, more than three times the global average of 9.3 — a pattern Chainalysis said was consistent with users treating stablecoins as working capital.

Chainalysis estimated China's broader crypto economy at $176 billion, with domestic P2P activity now accounting for 59.1% of the total, 3.5 times its 2025 share. March 2026 alone added $4.9 billion in domestic stablecoin transfer volume, the largest single monthly increase in the dataset.

Korea's economy grows, exchanges bleed

South Korea remained East Asia's largest crypto economy at $449.1 billion, with activity up 12.3% year-on-year to June 2026, Chainalysis said. Retail traders showed a strong preference for AI-linked tokens.

That headline growth masked a punishing first half for domestic exchanges. Operating profits fell 78% as trading volumes, valuations, and customer deposits all declined. The Korea Financial Intelligence Unit (KoFIU) said average daily trading volume at virtual asset exchanges fell 44% from the prior six months. Market capitalization dropped 33%. Won-denominated deposits fell 35%. Exchange sales declined 41%. The number of eligible trading accounts inched up just 0.4%.

Separately, tokenization platform Securitize signed a memorandum of understanding with South Korean technology firm LG CNS to develop tokenized assets and digital-asset infrastructure for South Korean financial institutions. The country's Financial Services Commission proposed rules last week governing the issuance and circulation of tokenized stocks, bonds, funds, and other securities, with the framework set to take effect in February 2027.

What does Hong Kong's lead in institutional flows signal?

Hong Kong stood out across the region for institutional activity. Institutional platforms accounted for 16% of service inflows, nearly three times the share in any East Asian neighbor, and the city received nearly $24 billion in inbound business-to-business flows. Hong Kong issued its first stablecoin licenses in April.

Secretary for Financial Services and the Treasury Christopher Hui told a Monday policy briefing the government will submit an amendment bill "within this year" to establish licensing regimes for digital asset trading, custody, advisory, and management services, according to a Hong Kong government statement.

Japan's DEX share climbs as Tokyo widens Russia sanctions

In Japan, decentralized exchanges account for nearly 35% of crypto service activity, the highest share among mature East Asian markets, per Chainalysis. DEX activity has risen more than 200% since 2022, and 65.7% of swaps were sized between $10 and $1,000. Lawmakers passed revisions in July bringing digital assets formally under Japan's financial-markets framework.

Separately, Tokyo added Russian cryptocurrency exchange Garantex to its expanded sanctions list over the war in Ukraine. Officials placed 33 organizations and nine individuals linked to Russia on its asset-freeze list, restricting payments and capital transactions, per a joint Friday statement from Japan's Ministry of Foreign Affairs, Ministry of Finance, and Ministry of Economy, Trade and Industry. Garantex had previously been sanctioned by the US and EU.

Singapore builds out the institutional stack

Standard Chartered unveiled plans to launch digital asset custody in Singapore for institutional and accredited corporate clients, covering select cryptocurrencies, stablecoins, and tokenized real-world assets. The bank described Singapore's role as a "leading financial and innovation hub" central to its "global strategy."

Singapore-licensed exchange Independent Reserve added cross-border payment tools, allowing businesses to fund accounts in Singapore or US dollars and pay suppliers or employees in more than 20 currencies, with USDC and USDT as options. Its subsidiary ReserveX launched crypto derivatives trading for sophisticated investors. Payward, parent of Kraken, also partnered with Singapore Gulf Bank to enable round-the-clock institutional crypto settlement.

Crime and enforcement

India's Central Bureau of Investigation arrested four people in an alleged international tech-support fraud and extortion scheme targeting US nationals. The scam used fake Microsoft pop-ups and lured victims — one Florida resident lost $440,000 — into transferring funds to resolve fabricated computer compromises. In Thailand, three armed assailants robbed a home in Bang Lamung, forcing a foreign resident to transfer approximately $820,000 in crypto along with cash and three Rolex watches. Police suspect the robbers may be Chinese nationals.

Hong Kong's amendment bill is due before end-2026, and South Korea's tokenized-securities framework takes effect in February 2027 — the two near-term regulatory milestones that will shape the region's next enforcement cycle.