As international gold prices soared to historic highs, gold, the precious metal that embodies the Chinese people's obsession with wealth, once again became the focus of nationwide pursuit. Long queues formed as people rushed to buy gold, gold buyback stalls were packed with people, and online gold investment platforms saw a surge in popularity... However, amidst this frenzied market, greed drove people to do anything. Behind this seemingly prosperous gold rush, however, undercurrents and chaos lurked. Amidst soaring gold prices, gold consumption has descended into chaos. Recently, a Chow Sang Sang pure gold lucky bag pendant was reported to have been scratched and developed white marks after only one day of wear. Testing revealed that the pendant, labeled as pure gold, exhibited significant variations in gold content at different locations. The highest point reached 99.99%, meeting the pure gold standard, while the lowest point was only 64.37%, a difference of 35.62 percentage points. The test results also showed that the pendant contained various other metallic elements such as iron, silver, and palladium, clearly failing to meet the purity requirements for pure gold jewelry. Despite the brand agreeing to a refund, even a well-established brand like Chow Sang Sang, with years of experience in the gold and jewelry market, faces such difficulties; other brands are even more problematic. Since the gold bull market began in 2024, gold counterfeiting has become rampant, forming a complete industry chain. Physical adulteration, such as wrapping or adding cheap metals like gold-plated tungsten or gold-plated silver, can make the appearance and density resemble real gold, making it difficult to distinguish by ordinary fire or weight. In October 2025, a case involving rhenium adulteration, exceeding 800,000 yuan, specifically targeting gold shops, occurred in Changxing, Zhejiang. Taking advantage of the similarity in appearance and density between rhenium and gold, the suspects mixed rhenium into gold to make jewelry, then sold it as genuine gold to multiple jewelry stores in Anhui, Zhejiang, Jiangsu, Jiangxi, and other places. Furthermore, the sale of gold is increasingly plagued by forged documents and certificates. Reports indicate that fake certificates bearing various authoritative logos can now be "customized" online for as little as 5 yuan, without the need to send samples. While the testing institutions on the certificates appear legitimate, they are actually illegal social organizations not registered with the civil affairs department. By the time consumers receive the certificates and realize they've been scammed, the shops have long since closed down and disappeared. Since 2025, the China Consumers Association has repeatedly reported an increase in gold consumer disputes. In the past three months alone, the Black Cat Complaint platform has received nearly 4,000 complaints related to "fake gold." In a special supervision and spot check conducted by the Shanghai Municipal Administration for Market Regulation in October 2025, 60 batches of products from 51 brands sold by 56 companies were inspected in physical stores, online platforms, and live-streaming rooms. The test results showed that 22 batches of products were substandard, with a failure rate of 36.7%. Among them, all 5 batches of products sold in live-streaming rooms were substandard, highlighting the particularly prominent quality issues in online sales channels. Criminals defrauding gold shops, and gold shops deceiving consumers, constitute the current chaotic state of the gold consumption market. The booming yet chaotic gold recycling market represents another aspect of this chaotic gold market. High gold prices have spurred a strong demand for liquidation. However, while recycling channels appear diverse, including banks, gold shops, pawnshops, professional recycling stores, and online platforms, many are fraught with pitfalls. While buying counterfeit goods might allow you to retain most of your principal, being scammed in gold recycling could result in total loss. Recently, several gold recycling platforms in Shuibei have collapsed, with Jiewo Rui being the most representative example. At the end of January, a large number of consumers who had been deceived by Jieworui gathered in Shuibei, with many even traveling overnight from other places, hoping that Zhang Zhiteng, the legal representative of Jieworui and a popular influencer in the Shuibei gold recycling circle with nearly 70,000 followers on Xiaohongshu, would give them an explanation. Before the collapse, most people had probably never heard of Jieworui. However, in the eyes of the victims, Jieworui was once considered the most "conscientious" entity in the gold recycling circle. Initially, JWORK pioneered the "no processing fee" promise—users only needed to accumulate "gold materials" or balance on their platform to redeem gold jewelry during promotions, saving all processing fees. Traditional gold jewelry processing fees often amounted to tens or even hundreds of yuan per gram, making "no processing fee" tantamount to a direct discount, and the larger the weight, the more "earned." Furthermore, JWORK offered buyback prices higher than the general buyback price, only slightly lower than the market price, which even attracted many consumers to buy low-priced gold on other platforms and then sell it to JWORK to earn the difference. This "money-making method" spread like wildfire. Furthermore, as the platform expanded, JWORK gradually launched numerous highly risky services, such as futures trading. However, amidst this favorable environment, no one realized the dangers behind this model. In fact, as early as December 2025, issues such as delayed deliveries and unreachable customer service began to appear on JWORK. Ironically, until January 15th, just days before the collapse, the Jieworui WeChat official account was still pushing "2% return on gold hoarding during the Spring Festival," Zhang Zhiteng was still live-streaming normally on the account, and platform users were continuously sending gold to Shuibei. Until January 20th, Jieworui completely suspended all cash withdrawals and physical delivery. A large number of gold shipments destined for JWR were intercepted en route, and some conscientious deliverymen even proactively intercepted gold shipments about to be sent to JWR. This wealth-creation "feast" has thus come to an end, leaving only victims who were defrauded, some even losing their entire fortunes. Investors have spontaneously tallied the amount involved, which has already exceeded 100 million yuan. Whether this data is accurate remains to be verified, but it is enough to illustrate that there are indeed many irregularities in the gold market amidst the gold price frenzy. So, where exactly did the problem lie? Unlike the gold rush in 2013 triggered by the price crash, this round of gold frenzy stems more from people's anxiety about preserving and increasing their assets. Essentially, ordinary people hope to find a sense of certainty in this uncertain era through gold. As a result, gold shops in Shuibei were packed with people, and gold at bank precious metal counters was sold out, with young people flocking to the precious metals market to "do their homework." For the first time, investment demand for gold surpassed demand for jewelry. Data from the China Gold Association shows that in 2025, China's gold consumption was 950.096 tons, a year-on-year decrease of 3.57%. Of this, gold jewelry consumption was 363.836 tons, a year-on-year decrease of 31.61%, but gold bar and coin consumption reached 504.238 tons, a year-on-year increase of 35.14%. On the other hand, in 2025, the total holdings of domestic gold ETFs increased by 133.118 tons, a 149.91% increase compared to the 53.266 tons increase in 2024. The correlation coefficient between the holdings of the world's largest gold ETF and gold prices over the past two years reached 0.98, which to some extent means that rising prices have become the biggest reason for further price increases. The driving forces behind this gold rush include continued gold purchases by global central banks, an increasingly uncertain economic environment, declining returns or increased risks in traditional investment channels, and even many young people viewing gold investment as a social activity. Ironically, although gold is increasingly touted as a safe asset by institutions and platforms citing continued central bank purchases, using it for long-term asset allocation is fraught with insecurity. Just like the collapse of JWG—before its downfall, JWG had launched a "pre-price trading" model, where users could lock in the price of gold at a future point in time by paying a small deposit. The entire trading process was completely detached from physical delivery, evolving into a pure capital game. This was essentially a highly leveraged over-the-counter options trading, even far exceeding the leverage levels of the regular futures market. However, all this game of musical chairs required a constant stream of new funds to sustain it. As gold prices experienced an epic surge, the concentrated realization of profits and losses from short selling led to the rapid depletion of funds at Jiewo Rui, a company lacking financial licenses and without any risk hedging, ultimately resulting in its collapse. A jewelry company with only business registration could rely on internet platforms and gold as a medium to operate on the fringes of illegal wealth management and illegal fundraising, engaging in substantive quasi-financial business while completely circumventing the strict licensing and fund supervision of financial institutions. From a societal perspective, the consequences are terrifying. Behind the collapse of gold investment schemes, human greed is undoubtedly one of the essential reasons—merchants are greedy, so they shortchange customers, relax quality control, and even actively counterfeit gold when selling it. Speculators are greedy, so they readily join the game of musical chairs, lured by promises of "high returns, zero risk, and super convenience." Faced with an increasingly complex gold investment environment, ordinary people need to recognize the limits of their abilities and break free from their "superstition" about gold. While the probability of gold prices rising is not small, it remains just one asset, and all assets carry risk. Generally, investment institutions recommend that gold should account for 5%-10% of a family's total assets, and silver no more than 3%. They also advise avoiding high-leverage products such as gold futures and deferred trading, prioritizing stable options like low-fee ETFs. However, when "opportunity" presents itself, no one can remain calm. Furthermore, the recent proliferation of irregularities in the gold market presents new challenges for regulators. In fact, my country has already issued relevant laws, regulations, and industry standards to regulate the production, sale, and recycling of gold. However, in practice, insufficient supervision and lax enforcement of regulations have led to a continued proliferation of illegal activities. In the future, the market needs to establish stricter and more transparent standards and real-time monitoring mechanisms for the production, sale, and recycling of gold. Activities using gold as a guise for illegal fundraising and futures trading must be addressed more swiftly, with increased enforcement and higher costs for violations. Epilogue Recently, gold prices have fluctuated upwards after a sharp drop, and the streets of Shuibei are still glittering with gold. Those who blindly invested in gold initially have either cut their losses and left the market or actively bought at the bottom. Despite the still-prosperous gold market, many people still harbor dreams of owning a gold investment. Since ancient times, gold has embodied people's belief in wealth and security. However, in this ongoing wealth frenzy, a calm mind is more important than paper gains and losses. Embrace volatility, but remain calm and respectful. A tendency to chase trends leads to greed and a willingness to die. When the tide recedes, those who remain on the shore are the victors.
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