In Shenzhen, southern China, hundreds of small investors crowded outside the offices of a little-known precious-metals platform called JWR, waving contracts and phone screenshots as police tried to keep order. They were there for their savings following the sharp recent rise in the price of gold. But the company couldn’t meet the demand for withdrawals. Within days, local officials said they had formed a task force to investigate “abnormal business operations,” according to the South China Morning Post. By then, the damage was done: more than 10 billion yuan—about $1.4 billion—in potential losses after JWR froze withdrawals. The frenzy that had lured people in—China’s retail “gold rush”—now had a victim list and a crime scene.

The scandal lands at a delicate moment. Beijing’s central bank has been steadily adding bullion, while China’s reported holdings of U.S. Treasuries have slid to levels last seen during the global financial crisis. When analysts talk about war-planning “deadlines” for Taiwan—2027 is the date U.S. intelligence has highlighted as a military readiness target—they also talk about sanctions. Gold, in that telling, is the hedge against a dollar squeeze if the missiles ever fly. But it’s already a battleground with effects rippling to ordinary citizens.

Common Knowledge

On the American right, the view is that China is hardening for a sanctions war as the Taiwan clock ticks. In this reading, gold is sanctions-proof beyond the reach of U.S. retaliation. The right generally supports President Donald Trump’s China posture, though many warn tariffs are a blunt tool for handling relations with such a huge rival.

For this reason, many Trump critics call for de-escalation and engagement. This is the policy now apparently being pursued by some key American allies, including the U.K., Canada and France.

Policy experts warn that even if the G7 prepared a Russia-style sanctions package in the event of rising tensions over Taiwan, China is a different, more economically powerful beast. Yet officials and analysts on all sides agree that the “2027 window” looms over planning, even as recent purges by President Xi Jinping at the top of China’s military, including of General Zhang Youxia and Joint Staff Chief Liu Zhenli, inject uncertainty about its forces’ readiness.

Uncommon Knowledge

The latest scandal puts a human face on China’s gold mania. JWR’s collapse follows a stampede into bullion as prices hit successive highs: tens of thousands of investors piled into an online “metals trading” platform, only to trigger a run when investors wanted to bank their profits. The unpaid balances from the JWR scandal alone may exceed 10 billion yuan. The frenzy for gold has grown so intense that Chinese banks have periodically run short of small investment bars—the sizes that ordinary savers buy—during price spikes.

It all mirrors official behavior. The People’s Bank of China (PBOC) was on a bullion-buying streak through 2025, of at least 12 straight months by October, raising reported holdings to roughly 2,303 tonnes and valuing them near US$300 billion as prices surged. By the World Gold Council’s reckoning, China’s gold made up about 7–8 percent of its official reserves as of the third quarter.

At the same time, China’s cache of U.S. Treasuries has reduced. In November 2025 it stood at $682.6 billion, down roughly $86 billion from November 2024 and the lowest since 2008, according to Bloomberg.

At the same time, another country has seen its share of U.S. Treasuries grow: Belgium. Why? Because Euroclear, a Brussels-based securities custodian, often shows up as the “holder” when bonds are parked there. In November 2025, reported Belgian holdings reached $481 billion, up about $120 billion from a year earlier, as China’s fell. Some analysts have cautioned that some Chinese-owned Treasuries may be “masked” in European custodial accounts, complicating narratives about wholesale liquidation.

What does that mean for Taiwan-war economics? The most provocative hypothesis—that Beijing is selling Treasuries to buy sanction-proof gold ahead of a showdown—has some evidence to support it. Gold is harder to freeze than bank reserves. Of course, gold buying does not automatically equal war planning. It can also equal hedging against risks far short of invasion: tariffs, tech bans, and other sanctions.

What the JWR scandal shows is that ordinary Chinese citizens have had an appetite for gold equal to that of their leaders—except that the bosses in Beijing aren’t ready to cash in just yet.

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