In a recent appearance on 60 Minutes, former U.S. President Donald Trump asserted that China is “very much involved” in the cryptocurrency space — a striking statement given that the Chinese mainland formally banned crypto trading and mining back in 2021.
At first glance, the comment may seem contradictory or over-the-top: China has declared virtually all crypto transactions illegal, shuttered domestic exchanges, and forced mining operations to relocate. And yet, when you dig beneath the surface, Trump’s viewpoint reflects a layered reality of how China remains deeply plugged into the digital-asset ecosystem — albeit through indirect, strategic channels.
Hong Kong as a Crypto Gateway
Though the mainland keeps a hard line against speculative cryptocurrencies, neighboring Hong Kong has taken a different tack. Starting June 2023, the city rolled out a licensing framework that enables regulated virtual-asset trading platforms to operate.
Further, in April 2024, Hong Kong approved spot ETFs for both Bitcoin and Ethereum — a step impossible on the mainland — and as of November 2024 allowed licensed platforms to access global liquidity.
These moves make Hong Kong a strategic bridge: while the mainland enforces a ban, the region channels global crypto flows, and China as a broader entity benefits from the linkage. Hence, when Trump says “China is getting in strong,” part of what he means is the Hong Kong channel.
The Mainland Ban Doesn’t Tell the Full Story
On 24 September 2021, the People’s Bank of China (PBoC) declared all cryptocurrency trading and mining activities illegal within the mainland.
Despite that, some pressures remain: capital mobility (especially cross-border transfers), regulatory arbitrage, and demand for efficient payment channels persist. China has redirected these toward mechanisms that fall outside “traditional crypto speculation,” yet still influence the crypto-ecosystem.
The “ban” therefore does not equate to zero involvement — rather, it transformed the nature of involvement.
China’s CBDC, Stablecoins & Mining Supply Chains
Another piece of the puzzle is China’s push into a national digital currency, the e-CNY. With cumulative transaction volumes exceeding 7 trillion yuan by mid-2024, China holds one of the largest digital-currency experiments globally.
Though the e-CNY is not a cryptocurrency in the decentralised sense, its scale and ambition make China a major player in the broader digital-assets arena — which helps explain why Trump refers to China’s strong involvement.
Meanwhile, stablecoin usage tied to cross-border commerce (for example China-Russia trade avoiding traditional banking channels), plus China’s dominance in crypto-mining hardware manufacturing (companies such as Bitmain dominate globally), add further layers.
In short: even though speculative crypto trading is illegal in mainland China, Chinese entities and infrastructure remain embedded in the global crypto-system.
Why Trump’s Statement Makes Sense — In Context
When Trump says China is “deeply involved,” he isn’t necessarily referring to domestic retail crypto trading (which remains banned) but rather to the broader strategic engagement:
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Hong Kong acting as an on-ramp and licensed venue for crypto business.
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China deploying its state-backed digital currency at scale and integrating with Hong Kong’s financial infrastructure.
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Chinese firms and capital operating in the shadows (e.g., stablecoin flows, offshore OTC transactions) or focusing on mining hardware and global crypto supply chains.
Viewed from that lens, China indeed has a strong “footprint” in the crypto space even if outright trading and mining inside the mainland are prohibited.
Implications for the Global Crypto Landscape
China’s hybrid approach — banning retail speculation internally while cultivating strategic influence externally — has wide-ranging implications:
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Regulation vs. innovation tension: China paradoxically restricts free crypto markets domestically while fostering innovation and infrastructure internationally.
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Geopolitical competition: As Trump framed it, crypto becomes another arena of U.S.–China competition: not just for finance, but for standards, infrastructure, and global influence.
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Market perception: Investor and regulator perception that “China is in the game” may influence how jurisdictions craft policy, how markets price risk, and how infrastructure (mining, hardware, stablecoins) develops.
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Divergent models: China’s model — state-backed digital currency + limited licensed crypto venues — contrasts with the open, decentralised ethos of many crypto proponents. This divergence may shape global policy, interoperability, and future standard-setting.
Conclusion
The headline might seem surprising — a country that banned crypto is still “very much in crypto,” as Trump says. But the truth lies in nuance: China’s involvement is not the obvious path of mass retail trading and mining inside its borders. Instead, it is a complex blend of alternative channels: Hong Kong’s licensed platforms, the national digital currency program, stablecoin flows, mining infrastructure, and hardware manufacturing dominance.
In that sense, Trump’s assertion holds water: China is playing “strong” in the crypto arena — just not in the way most traditional crypto observers expect.
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