CH haltst trading in Shenzhen

CH haltst trading in Shenzhen

China Halts Trading in Shenzhen Gold and Silver Platforms Amid Market Volatility

Authorities in Shenzhen, China, have taken steps to stabilize its volatile precious metals market, including halting trading on certain platforms and tightening regulatory oversight. The measures follow a surge in speculative demand for gold and silver, which has driven local prices significantly above international benchmarks and exposed investors to heightened risks.

The Luohu district government established a special task force to investigate the operations of Shenzhen-based gold-trading platforms, including Shenzhen Jiewo Rui, after investors reported difficulties withdrawing funds. The platform allows users to trade gold with up to 40-times leverage, amplifying exposure to price swings. Tensions escalated when approximately 100 investors gathered at the company's premises, with unverified reports of altercations with police.

Regulatory action has expanded to include restrictions on marketing practices and leveraged trading. A joint notice from ten government departments, including Shenzhen's financial regulatory bureau, prohibits operators from using exaggerated slogans such as "get rich by buying gold" or making false claims about price movements. The directive also bans irregular pre-pricing and leveraged transactions, aiming to curb speculative excesses.

Market volatility has been fueled by global gold prices surging to record highs above $5,300 per ounce in January 2026, driven by dollar weakness and de-dollarization concerns. Local silver prices in China have risen even more sharply, with the UBS SDIC Silver Futures Fund LOF halting subscriptions after its premium over Shanghai Futures Exchange contracts reached 36%—a level deemed "unsustainable" by its managers.

The Shenzhen-based Shuibei bullion market, a key hub for physical gold and silver trading, has seen multiple platform failures this year. A major silver seller there defaulted on deliveries in January, leaving over 350 investors awaiting compensation.

Authorities have emphasized the need to "defuse market risks" and protect retail investors, with sector-wide warnings issued as early as October 2025. While gold prices have since stabilized near $4,970 per ounce, the regulatory crackdown underscores ongoing concerns about leverage, liquidity, and speculative behavior in China's precious metals markets.

Investors are advised to remain cautious as regulators balance market stability with the risks of speculative frenzies.