China’s largest banks are ending retail access to leveraged paper gold products. Industrial and Commercial Bank of China (ICBC), the world's biggest bank by assets, will halt services linked to the Shanghai Gold Exchange (SGE) after settlement on July 24, 2026. Postal Savings Bank of China, Ping An Bank, and China Guangfa Bank are following suit.
The move gives existing retail clients one month to close positions, liquidate holdings, or take physical delivery. The shutdown follows extreme volatility in 2026, with gold prices swinging from nearly $5,600 per ounce to below $4,000-a roughly 30% drop. Banks responded by raising margin requirements to as high as 140%.
This regulatory tightening traces back to the 2020 'Crude Oil Treasure' scandal, which saw retail investors suffer massive losses when oil futures went negative. Since then, China has progressively restricted retail speculation, first pausing new SGE accounts and now closing existing ones.
Physical gold purchases, non-leveraged gold investment plans, and Gold ETFs remain unaffected. The SGE continues to operate normally for institutional and physical delivery markets. Displaced retail capital is expected to flow into these alternative, non-leveraged vehicles.