Financial regulators in Shenzhen, South China's Guangdong province, have since October strengthened an investigation into sneaker trading to prevent financial risk.
According to a report in Shenzhen Special Zone Daily, financially speculating on sneakers has become rampant and led to significant risk in the southern metropolis, a pioneer city of China's reform and opening-up.
"Illegal fundraising, illegally taking public deposits with high interest rates, financial fraud and illegal pyramid sales have been investigated and found to be behind some of the illegal sneaker speculation, and it is alarming," an official with the Shenzhen municipal financial regulatory bureau was quoted as saying in the report published on Thursday.
"At least 10 platforms on the mainland have been investigated for providing channels to speculate on the so-called limited editions of sneakers," the report said.
Sneakers like Air Jordan are popular with enthusiasts and sneakerheads, the report said.
According to the report, thousands of local residents competed to buy the limited-edition Air Jordan 1 shoes in the rain when Asia's largest Air Jordan flagship store opened in Shenzhen in April.
A pair of women's limited-edition Air Jordan 1 sneakers, which were originally priced at 1,299 yuan ($185.57), soared to an average of 5,800 yuan, with the highest price coming to 12,000 yuan.
Many Air Jordan fans and speculators continue to buy the sneakers when limited editions and celebrity editions of sneakers come to market despite soaring prices, the report said.
Hu Eryi, head of P2P001.com, a Shenzhen-based internet financial web portal, said speculating on sneakers is now accumulating risk and affecting the sneaker market.
"It is time to give an alarming signal and take effective and concrete measures to avoid the risk," Hu said.
Shenzhen has taken the lead to raise the alarm and take preventative measures to investigate rampant sneaker speculation on the mainland, the report said.
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