goldtrading

The collapse of a major Chinese gold trading platform has sent shockwaves through the investment community, with reports of frozen assets affecting thousands of retail investors nationwide.
The platform, identified in various sources as Jie Wo Rui (also referred to as Jiewo Rui or JWR), based in Shenzhen, has halted withdrawals, leaving users unable to access their funds or retrieve physical gold holdings. Social media alerts circulating widely describe the frozen amount as high as $19 billion, with the platform offering only 20% compensation based on initial capital invested. The owner has reportedly requested more time to resolve the issue, claiming to have been "set up" or "trapped" in the situation.
Protests erupted outside the company's offices in Shenzhen, with videos showing crowds clashing with police. Investors have accused authorities of protecting the platform, alleging that Shenzhen police in the Luohu district are refusing to accept formal complaints, even though deposits came from across China.
Official and media reports paint a more measured picture. Reliable outlets like the South China Morning Post (SCMP) and Yicai estimate unpaid funds at over 10 billion yuan (approximately $1.4 billion USD), with some investor compilations suggesting figures could exceed that but not reaching the $19 billion mark cited in viral posts. The crisis appears tied to China's ongoing "gold fever," fueled by surging global gold prices in recent months. Many investors used the platform for leveraged trades—locking in future gold delivery with margins as low as 1/40th of the spot price (effectively 40x leverage)—which amplified risks when prices rallied and withdrawal demands surged simultaneously.
This exposed severe liquidity issues: the platform struggled to meet redemptions, leading to a capital chain breakdown. Authorities in Shenzhen's Luohu district have established a special task force to investigate abnormal operations and oversee the situation, including potential asset tracing and recovery efforts.
Comparisons to the FTX collapse have proliferated online due to the scale, frozen funds, limited compensation offers, and investor outrage. However, verified reports indicate a significantly smaller scope than $19 billion—closer to $1.4–1.8 billion USD—though the impact remains devastating for tens of thousands of affected retail participants.
The incident highlights broader risks in China's unregulated or lightly regulated private precious metals trading sector, especially amid high leverage and speculative frenzy. Investors are advised to exercise extreme caution with similar platforms, verify regulatory status, and prioritize established, transparent exchanges.
Developments are ongoing, with the task force's findings potentially clarifying the full extent of losses and any recovery prospects. Further updates from official channels or credible media will be key.
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​In a move to curb "investment mania" and extreme speculation, China has suspended trading for 5 major commodity funds linked to Gold and Silver. This decision aims to protect retail investors from massive market volatility.

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