The Chinese payments company said on 28 October that it neither supports virtual currency transactions nor authorises third-party platforms to offer cryptocurrency purchases through its services. It warned customers to safeguard their money and accounts when encountering such offers.
The denial followed Peer’s announcement on 27 October that an Alipay payment option was available in beta on its peer-to-peer marketplace. The platform said users could purchase USDC by transferring yuan to individual sellers or sell the digital token and receive yuan through Alipay.
Peer has acknowledged that it has no official partnership with Alipay. Its description of the service distinguishes direct payments between individuals from a formal technical integration with the payment provider, a distinction central to the disagreement between the companies.
Alipay’s position is that claims suggesting cryptocurrency purchases are supported through its network are false and unauthorised. That statement does not, by itself, establish whether individual yuan transfers associated with Peer trades have taken place or whether Alipay identified and blocked any particular payment.
Peer said its beta arrangement had been operating since 21 August and had handled 107 orders involving 45 buyers, with a combined transaction value of approximately $7,094. Those figures were supplied by the marketplace and have not been independently confirmed by Alipay.
The reported activity amounts to roughly $66 per order, indicating that the transactions disclosed by Peer were relatively small. The company has not provided evidence establishing that its reported volumes represent broader demand for yuan-funded stablecoin trading through Chinese payment applications.
Under Peer’s stated procedure, a seller deposits USDC into an on-chain escrow contract before a buyer initiates a purchase. The buyer then transfers yuan directly to the seller using the designated payment method. Once payment is verified, the escrow arrangement releases the cryptocurrency to the buyer.
The structure separates the conventional payment from the blockchain transfer. Alipay would process the yuan payment between its customers, while the cryptocurrency changes hands outside its own systems. Such separation does not mean that the payments company has approved the purpose of the transfer.
Peer’s interface continued to identify Alipay as a payment method following the denial, while its buyer instructions acknowledged the absence of any official relationship. The continued listing illustrates the difference between a marketplace advertising a means of settlement and the payment provider expressly endorsing its use.
The episode also raises an immediate compliance issue because mainland China prohibits cryptocurrency exchange services and restricts financial institutions and payment providers from facilitating virtual currency transactions. Authorities have treated trading between conventional money and digital tokens as part of the prohibited activities.
Those restrictions apply regardless of whether a digital asset is described as a stablecoin. USDC is issued by Circle and is designed to maintain a value of approximately one US dollar, but its dollar peg does not exempt cryptocurrency transactions from applicable Chinese rules.
Alipay has maintained controls against the use of its payment infrastructure for cryptocurrency activity. Its public rejection of Peer’s announcement is consistent with that policy, although the company has not disclosed whether it is investigating specific accounts connected with the beta service.
The practical implications for participants depend on how individual payments are identified and handled. A transfer between two Alipay users may resemble an ordinary personal payment even when it forms one part of a separate cryptocurrency transaction. Neither company’s statements establish that all such transfers can be reliably detected.
Peer describes itself as a decentralised trading service, but the buyer and seller still depend on a conventional payments channel to exchange yuan. The blockchain escrow arrangement can govern release of USDC; it cannot compel an external payment provider to permit or process a transfer.
The marketplace’s published materials identify the settlement token as USDC and the payment currency as Chinese yuan. Its Chinese-language buyer guidance explains the steps for arranging purchases, while the beta announcement directed customers to additional instructions and support.
Peer’s terms identify P2P Labs as the provider of its website and application, separate from the underlying trading protocol. The platform’s disclosed transaction count covers its own beta activity rather than all transfers made through Alipay or other payment networks.
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