Chainalysis explores the crypto economy of countries in East Asia, covering Japan, China, Hong Kong, Taiwan, and South Korea.
According to Chainalysis’ latest Geography of Crypto report on East Asia, Japan’s crypto traders are increasingly moving toward decentralised exchanges (DEXs) and perpetuals trading, with DEX inflows rising 36% over the past year.
The region’s overall crypto economy contracted modestly between July 2025 and June 2026. South Korea led the region with a US$449.1 billion crypto economy, followed by Japan (US$228.3 billion), Hong Kong (US$192.2 billion), China (US$176.3 billion), and Taiwan (US$140.4 billion).
Japan: DEXs and Perpetuals Take Centre Stage
According to the report, Japan’s US$228 billion crypto economy is increasingly shaped by institutions rather than consumers, but retail activity is still significant.
DEXs held nearly 35% of Japan’s services market in the 2026 period, with retail DEX swaps concentrated in smaller trades. Japan’s DEX engagement has trended upward since 2022 while CEX activity over the same period stayed flat.
Much of the trading activity centres on perpetual futures, with Japanese traders using venues such as Hyperliquid alongside their equity portfolios to manage directional and macro exposure.
Tokens like BTC remained Japan’s most popular category by far, followed by smart contract tokens such as Ethereum and Solana.
South Korea: AI-Crypto Boom Powers the Economy
South Korea’s US$449 billion crypto economy grew 12.3% period over period, driven by 16.3% growth in its exchange ecosystem and an additional US$51.1 billion in exchange-related flows.
Much of the growth stems from South Korea’s retail-driven market and is linked to the broader AI investment trade that dominates the country’s stock market.
AI-linked cryptocurrencies are now the single most popular thematic investment category by share of won-denominated trading volume. Worldcoin (WLD) led the category with US$7.41 billion in volume, followed by other tokens like SAHARA (US$3.2 billion) and VIRTUAL (US$2.7 billion).
Institutional participation remains nascent, with banks and securities firms building their own digital asset teams.
Hong Kong: East Asia’s Institutional Hub
Institutional platforms capture 16% of Hong Kong’s service inflows in 2026, up from roughly 9% two years earlier and nearly three times any other East Asian market. That activity is concentrated among custody, prime brokerage, and market-making desks, which together account for 85% of the category.
This is attributed to government policies that place digital assets at the centre of the city’s financial strategy, including Hong Kong’s first Five-Year Plan. The city pulled in nearly US$24 billion in inbound business-to-business transfers, and cumulative net B2B inflows reached US$17.4 billion by mid-2026.
China: Stablecoins Fill the Gap Left by a Banking Ban
China’s crypto economy is the hardest to measure due to the country’s longstanding ban on crypto services, but Chainalysis estimates it reached at least US$176 billion in the 2026 period.
The bulk of China’s crypto activity flows between individuals rather than through banned exchanges, with domestic peer-to-peer transfers making up 59.1% of the country’s crypto economy. On just US$3.1 billion in average holdings, China moved US$104.1 billion across 18.1 million transfers during the period, a pattern Chainalysis says is consistent with stablecoins functioning as working capital for everyday transactions.
Read the report here.
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