At its peak, the gold exchange, which had an "all-round license" and was omnipotent, was finally about to leave the market.
Recently, the local financial management departments in Guangdong, Hainan, Xiamen and other places have issued announcements saying that they will cancel the business qualifications of a total of 8 financial asset trading venues (hereinafter referred to as the "gold exchanges") under their respective jurisdictions, and remind the relevant risks, which is the third batch of gold exchanges "shutdown tide" since the beginning of this year.
On March 25, the local financial management departments of Hunan, Liaoning, Xi'an, Chongqing and other four places issued an announcement to cancel the business qualifications of the financial exchanges under their respective jurisdictions.
On May 10, the local financial regulatory authorities in Shandong, Jilin and Jiangxi announced the cancellation of their respective financial exchanges.
What is the Gold Exchange? Why was it suddenly closed?
The full name of the gold exchange is the local financial assets exchange, which is a local financial asset trading platform, with a total of three trading modes: directional financing, income rights and asset transfer; Bank wealth management products are issued by banks, developed and designed and sold for specific groups, wealth management mainly invests in deposits, large certificates of deposit, bonds, stocks, foreign exchange, precious metals and other assets, wealth management is a non-principal-guaranteed product.
The purpose of the establishment of the FSE was to activate local finance and provide a variety of financing products for local economic development. The FSE has played an active role in complementing the multi-level capital market, especially the debt trading market, promoting the circulation of financial assets, serving private finance, and building local financial infrastructure.
However, in the process of business development, the formal gold exchange and the "fake gold exchange" are mixed, and some companies issue and sell non-standard debt financing products for various types in the name of registration, filing, listing transactions, information release, information services, etc., which are actually engaged in illegal financial activities.
According to the China Financial Stability Report (2023), non-standard wealth management products of the "fake gold exchange" are often used to supplement the liquidity of issuers, or to build capital pools, which are further used to operate high-risk investments or even fake projects. The product attracts unspecified investors in the form of high interest returns, and it is not uncommon for the annualized yield to be higher than 8%, or even 10%. Once there is a problem in the operation of the project, the product will break out due to the inability to redeem the funds in time, and the investor will suffer heavy economic losses or even lose all his money.
Ye Yindan, a researcher at the Bank of China Research Institute, pointed out that some financial exchanges have become "channels" for private institutions to carry out illegal businesses such as self-financing or capital pools, and some private financial institutions have packaged products through the gold exchanges, packaging real estate financing projects, products suspected of self-financing or capital pool business into "regulated" and "registered" fixed-income wealth management products, and peddling them to the majority of investors, further amplifying the risks of illegal fund-raising and financial fraud, negatively affecting the standardization of the market, and also increasing financial risks.
Investors need to be vigilant and fully understand the associated risks:
1. Choose formal channels: Investors should choose to invest in formal financial trading platforms and avoid participating in unregulated or non-compliant gold exchanges.
2. Understand investment products: Before investing, fully understand the characteristics, risks and market conditions of the investment products, and do not blindly follow the trend.
3. Diversify investment risk: Avoid investing all your money in a single high-risk product and diversify your investment to reduce the overall risk.