Mainland Chinese residents are flocking to crypto shops in Hong Kong to purchase digital assets in order to circumvent China’s cryptocurrency trading ban. While crypto transactions are illegal on the mainland, crypto trading is legal in Hong Kong, and the city is seeking to become a digital assets trading hub. These lightly regulated bricks-and-mortar crypto shops are becoming increasingly prevalent due to surging demand from mainland Chinese visitors and ambiguity over their regulatory status.

They allow customers to purchase large volumes of cryptocurrencies with lighter, or sometimes zero, checks, making it easy for customers to buy digital assets with cash without disclosing their identity or the origin of the money.

Despite China’s strict stance on cryptocurrencies, Chinese residents are still eager to purchase digital assets. One 27-year-old man who frequently travels from Shenzhen to Hong Kong to purchase digital assets, said that he holds cryptocurrencies in order to “transfer money to other places”, and he is willing to make the 90-minute cross-border trip whenever necessary.

As more mainland Chinese residents travel to Hong Kong to purchase digital assets, the prospects for these crypto shops are looking good, and with the Hong Kong government actively pushing for digital assets trading, this trend may further strengthen.