Author: Chloe, ChainCatcher
On July 14, 2026, several community users confirmed that Coinbase, the largest compliant exchange in the United States, has opened user registration for Chinese users, supporting "second-generation ID cards" with +86 phone numbers to complete KYC, with some users passing initial review within a minute. Wu confirmed this with Coinbase employees, but the official has not released any formal announcement to date.
However, this door is only half open: accounts currently only support on-chain deposits, withdrawals, and trading transactions, and do not support fiat currency deposits or withdrawals via bank cards; users can only receive deposits of USDT and other stablecoins through on-chain addresses. This article outlines the details of the event and proposes a motivation inference centered on Deribit, in contrast to the regulatory red lines that Beijing has never loosened, as well as the risk list that Chinese users must face.
No official announcement from Coinbase yet
On July 14, Beijing time, screenshots of user registration being opened for Chinese users began circulating on social media. Users can directly use Chinese "second-generation ID cards" combined with "+86 phone numbers" for quick KYC verification. According to tests conducted by users in the X community, initial review can be completed within a minute, and no additional overseas address proof is required during the initial stage.
Feedback from tests on the V2EX forum provided more details: the entire process takes about five minutes, and registering with an ID card can waive the address proof requirement; if a passport is used instead, the system will require uploading address proof documents. Some users have confirmed that the platform indeed allows new user registrations, and identity verification takes about a minute to complete.
Additionally, reports indicate that Coinbase employees have also confirmed that users can now use their Chinese resident ID cards and complete identity verification with a mainland Chinese address; the previous process required using a Chinese passport combined with a Hong Kong address for registration and verification. In other words, this is a substantial adjustment to the verification policy, not just a front-end error.
However, Coinbase has yet to release any official announcements, nor has it clarified which products will be available after registration. The publicly available identity verification documents still list only passports as acceptable documents for China and do not show ID cards or Chinese address options. This situation, where the front end has already gone live, documents have not been synchronized, and announcements are completely missing, suggests that this could be an effort to cautiously expand operations or a deliberately low-profile limited opening.
Accounts that can only deposit: What can and cannot be done
For Chinese users, the actual use of this account has clear boundaries. According to V2EX users' tests, Chinese users can currently only perform on-chain deposits, withdrawals, and trading transactions; bank fiat deposits are not supported. In other words, Chinese Yuan cannot be deposited or withdrawn via bank cards or third-party payments at Coinbase, and the only funding channel is through on-chain addresses: users can transfer USDT, USDC, or other digital assets to the Coinbase address from other wallets or platforms and then trade on the platform.
This is consistent with Coinbase's compliance framework. Its supporting policies allow the company to restrict deposits, purchases, or other account functions when local laws prohibit the provision of a particular service. Opening registration and identity verification does not automatically mean all trading pairs, payment methods, and fiat currency services are available.
The verification process itself also has time limits. New registered accounts have restricted functionality until identity verification is completed, and users must upload government-issued documents through the official verification entry. The platform typically completes reviews within 24 hours but will periodically require re-verification later for record-keeping, compliance, and anti-fraud purposes. For Chinese users, this means that every re-verification is a time point where the account status is reassessed.
Why now: Three clues point to Deribit
The following motivation analysis is primarily organized from the perspective of X user Phyrex (@PhyrexNi). Why has an exchange known for compliance, which has long listed China as a restricted region, chosen to break the ice at this moment? This content is inferential rather than an official statement from Coinbase, but three verifiable clues collectively point to the same answer: Deribit.
Clue One: U.S. law does not prohibit it, and China has difficulty enforcing jurisdiction
One of Coinbase's compliance bottom lines is not providing services to countries and regions sanctioned by the U.S. OFAC, and China is not on that list. Therefore, even if China itself prohibits cryptocurrency transactions, providing account opening services to Chinese users is not illegal under U.S. law. Conversely, from China's perspective, Coinbase has indeed violated the domestic prohibition against overseas exchanges providing services to domestic residents; however, Coinbase does not have a physical presence in China, making enforcement difficult.
Comments in the Chinese community point out that China has previously punished overseas brokers (such as Tiger Brokers) for registration, and theoretically, the same logic could apply to Coinbase, but the difficulty of cross-border enforcement is clearly higher. Between this back-and-forth, there may be room for Coinbase to attempt.
Clue Two: Deribit has written the value of the Chinese market into its financial reports
The real opportunity may be Deribit. Coinbase completed the acquisition of this cryptocurrency derivatives exchange on August 14, 2025. Deribit has always had a high proportion of Asian and Chinese-speaking users; although specific data has never been disclosed, the value of this user base has been clearly quantified: in the 10-Q filing submitted by Coinbase to the SEC, Deribit's "customer relationship" intangible asset is valued at approximately $1.059 billion, with an amortization period of 15 years.
In other words, Coinbase paid a book value in the billion-dollar range for Deribit's existing customer relationships, which includes a large number of Chinese-speaking users. Opening registration for Chinese users may be a natural extension of this investment.
Clue Three: KYC integration makes Chinese users a part of the options entry
Coinbase has clearly advanced the integration of Deribit accounts with its own KYC system: clients at Deribit international exchange do not need to redo KYC during migration and can trade Deribit’s options products directly within the Coinbase application in the future.
Linking this integration path with “opening KYC to Chinese users,” the two matters form a line: opening accounts for Chinese users is essentially paving the way for Deribit’s options business.
Currently, the cryptocurrency options exchange with the best liquidity depth remains Deribit. After integration with Coinbase, promoting Coinbase options is essentially engaging in differentiated competition with peers like Binance and OKX: first attracting Chinese users using the advantages of Deribit’s options, and then guiding options users to the futures and spot markets through subsidies and activities.
In the first quarter of 2025, Deribit brought Coinbase over 80% of Bitcoin options market share and over 90% of Ethereum options market share. This monopoly-level market depth is precisely the confidence for engaging in differentiated competition.
The regulatory wall is gradually rising, and the market background is also unfavorable for easing restrictions
On the other side of Coinbase opening its doors is a regulatory wall that has only increased over the past five years. In September 2021, ten departments, including the People's Bank of China, issued Document No. 237, clearly stating that activities related to virtual currencies are illegal financial activities and that providing services to domestic residents through overseas exchanges is also deemed illegal financial activity, subject to long-arm jurisdiction. This red line is the background for Coinbase’s long-standing listing of China as a restricted region.
Moreover, this wall has only just been raised. On February 6, 2026, the People's Bank of China, the China Securities Regulatory Commission, and eight other departments jointly issued a notice reiterating that domestic activities related to virtual currencies are illegal financial activities, prohibiting the tokenization of real-world assets (RWA) and explicitly stating that without consent, no domestic or foreign units or individuals can issue stablecoins pegged to the Renminbi.
The attitude of regulatory authorities has also been consistently expressed to the outside. The Governor of the People's Bank of China, Pan Gongsheng, stated that stablecoins currently cannot effectively meet the basic requirements for customer identity recognition and anti-money laundering; Wang Xin, head of the research bureau, called at the Lujiazui Forum in June 2026 to closely monitor the impact of stablecoins on the international monetary system and cross-border payments.
The market background is also unfavorable for loosening regulation. Bitcoin reached a peak of more than $120,000 each in October 2025, but in February 2026, it briefly fell below $70,000, emphasizing speculation risks according to official media.
In other words, this ice-breaking is entirely Coinbase's unilateral action. There are no signs of loosening the ban on cryptocurrency transactions and overseas exchanges providing services to domestic residents in China.
Risk List: Four accounts users need to be aware of
The first account is account sustainability risk. If the system later detects that the user's actual residence is in China, the account is likely to face freezing or restrictions, and fiat deposit and withdrawal functions will likely be unusable. In the absence of an official announcement, this registration channel itself may be closed at any time, and users cannot claim any promises based on it.
The second account is funding channel risk. The structure of being able to deposit but not withdraw fiat means that asset transfers completely rely on on-chain transactions. If the account is restricted while holding positions, users may not only be unable to withdraw fiat but may also be required to supplement verification for on-chain withdrawals.
Coinbase is known for its strict compliance reviews. Comments from the Chinese community remind that it may require users to submit proof of asset sources, bank statements, etc.; if unable to provide these, the platform may not allow withdrawals, and fees are relatively high compared to peers.
The third account is legal and rights protection risk. According to Document No. 237 and the February 2026 notice from eight departments, civil actions related to virtual currency transactions by domestic residents are not protected by law, and providing services to domestic residents by overseas exchanges falls under illegal financial activities.
It is important to clarify a difference that is easily overlooked and which Phyrex particularly reminds: Coinbase is sufficiently compliant in the U.S., but that does not mean Chinese users will be protected within China.
Having experienced the FTX incident, the lesson to be learned is that once a platform encounters issues or a user needs to assert their rights, the difficulty of rights protection is extremely high if the platform is not compliant in their country. The claims process for FTX Chinese users was exceptionally difficult. Compliance is an asset at the platform level but does not automatically convert into the claims rights of individual Chinese users.
The fourth account is information asymmetry risk. Currently, all details come from user tests and informal confirmations from employees, and official documents even contradict the front-end processes. Before Coinbase publishes a formal announcement, any judgments about the scope of openings, product permissions, and duration are mere speculation.
Three indicators worth monitoring going forward include whether the official releases announcements and updates supporting documents, whether the ID card registration channel remains open, and whether the product permissions of restricted accounts gradually expand. The trends of these three indicators will determine whether this ice-breaking is a test or the beginning of a new era.
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