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    Crazy Stones: The Chinese Gamblers Betting Millions on Rocks

    Gambling on the contents of uncut jadeite stones has a long history along the China-Myanmar border. Now, livestreamers are taking the practice nationwide.
    May 27, 2021#cross-border

    On April 23, a Chinese court finished hearing arguments on a curious legal suit. In 2019, a businessman from the southwestern Yunnan province identified in media reports by his surname, Zhang, sold an 18-kilogram rock of rough jadeite to Ma, the chairman of a well-known steel company, for 80 million yuan ($12.4 million). Although Ma knew the risks involved in buying uncut jadeite, when he cut it open he was nonetheless angered to learn that the value of his purchase was far lower than he expected: just 4 million yuan. Telling Zhang he’d like to try again, he had the broker go to Myanmar to buy another stone. But when Zhang brought the second piece to Ma’s company, Ma seized it, refusing to pay until he received a refund for the first one. After failing to reach an agreement, Ma called the police, and Zhang and his associates were subsequently charged with fraud.

    At the heart of the case is an old practice currently undergoing a mass revival. Known as “stone gambling,” it has long been a popular method of trading rough jadeite across the China-Myanmar border. The outer layer of some jadeite stones is so weathered that it is impossible to judge the quality of the mineral underneath: Only after they are cut open can appraisers ascertain their true value. Some thrill-seeking gamblers take advantage of this by buying up uncut jadeite in hopes of striking it rich. The highest-quality jadeite, flawless and nearly transparent, can fetch huge sums on the open market. One interviewee of mine spent 50,000 yuan on a stone; when he cut it open, he found a piece worth 20 million yuan. If Ma’s bet had paid off, he might have been able to sell the stone for hundreds of millions more than he paid. Instead, he claims Zhang tried to pass off poor-quality Guatemalan jadeite as stone from Myanmar.

    Generally speaking, the very best jadeite specimens are collected by the mine owners themselves, or else sold to collectors around the world. Some are brought to public auctions in Myanmar. The remainder are divided into two batches, with one transported by sea to Hong Kong and Guangzhou in South China, where the stones will be cut to produce high-quality jade jewelry and other goods. The other is transported overland to Ruili, just across the border from Myanmar in Yunnan. The city’s proximity, low logistical costs, and lack of jade artisans make it a good place to unload rough stones of unknown value.

    The region has a long history as a center of both the jadeite trade and stone gambling. According to historical records from the Qing dynasty (1644-1911), jadeite traders along the China-Myanmar border would speculate on the quality and color of jadeite based on the characteristics of its weathered outer surface. A host of folk customs for picking stones had sprung up by the early 20th century. For example, before betting on a stone, buyers would kill and stew an over-1-year-old rooster, eat its head, and look at its bones to see whether they should go ahead with a purchase. Others burnt incense, maintained a vegetarian diet, and abstained from sex while performing a four-day observation ritual on their chosen stone in the hopes that its true value would reveal itself to them.

    After the founding of the People’s Republic of China in 1949, this hitherto prosperous cross-border trade was suppressed by the government’s regulation of luxury goods. Only with the “reform and opening-up” of the 1980s did Ruili reclaim its status as the center of the jadeite trade, setting the stage for a stone-gambling boom in the ’90s.

    At the time, Ruili lacked a dedicated jewelry market: Most of the jadeite stones for sale were hoarded in a few local hotels. Every morning, brokers — mostly ethnic Shan and Kachin from Myanmar or else Myanmar citizens of Chinese origin — would wait for buyers under a huge ficus tree, a local landmark. When a buyer arrived, they would take them to a hotel to see the goods. The brokers played a central role in each transaction. Many had worked as jadeite miners in northern Myanmar, and so were well acquainted with the sources of jadeite. According to a broker who’s worked in the industry since the 1980s, buyers would always bring gifts for the go-betweens in hopes of gaining insider information.

    The 1990s were a chaotic time for jadeite traders. Merchants from Myanmar saw the chance to make a quick fortune from tourists to Ruili, and soon began producing fake jadeite. Some of their techniques were quite crude, like filling stones with green toothpaste to make them appear green when held up to a lamp.

    Eventually, tightened border controls and the impact of the 1997 Asian financial crisis caused the stone-gambling bubble to pop, and Ruili entered a period of stagnation. It would revive after 2000, when a “border trade zone” offering duty-free transactions opened in the area. Stone gambling was adopted by the first batch of jewelry markets to open in the city and reached a new peak between 2009 and 2013. Legends of gamblers who got rich overnight circulated throughout China, attracting speculators to Ruili and causing the price of rough stones to soar. To keep up with the increased demand, markets stayed open late into the night, giving Ruili the appearance of a casino town. Most out-of-towners had no expertise or knowledge of the jade trade, and their blind bets often left them on the brink of bankruptcy. Ever since, there has been a proverb in Ruili’s stone-gambling circles: “One will win big, one will lose, one will wind up in rags.”

    Awareness of the risks involved in stone gambling has risen since 2014, and for a time it seemed that the practice might fall into decline. Instead, the rise of livestreamed stone-gambling events has pushed the craze to new heights.

    Beginning in 2018, merchants have used the streams to attract new stone gamblers from all over the country. One of my research participants, the owner of an electronics company in the eastern city of Hangzhou, is an amateur collector of rough jadeite and a fan of livestreamed stone gambling. At first, he simply watched appraisals of jadeite stones, but after a while, he decided to try his luck. “When I watch them cut open the stones, I feel like I’m watching a jewelry appraisal show — it’s that exciting,” he told me. “After a while, I felt as though I’d picked up a bit of jadeite expertise, so I started to buy some cheap stones for the fun of it. Now, the more I buy, the more addicted I am.”

    Livestreams have dispensed with the secrecy and regional limitations that originally defined stone gambling, making the practice more accessible outside of Ruili and providing audiences with a greater sense of participation. Generally, the streams start with a brief introduction to that day’s rocks. If a viewer asks for a closer look, the streamer will give a more in-depth description, while audience members guess its value. Once a purchase is completed, a buyer can have the rock shipped directly to them or ask the streamer to cut it open live on camera. It’s lucrative work. Last year, a top jadeite livestreamer could move 1 million yuan in goods over the course of a single evening.

    To boost audience engagement, livestreamers go to great lengths to make their businesses and stones appear authentic. Some will ask a Myanmar local to wade out of a river, jadeite stone cradled in their hands, or to say that a stone is an heirloom that they’re selling to save a seriously ill family member. Other merchants offer to help craft products from rough jadeite stones once they’re bought and opened, only to send an already-made product from the market to the customer and keep the rough stone for themselves.

    Livestreaming has reinvigorated Ruili’s stone-gambling industry, despite a growing imbalance between supply and demand: Good jadeite is increasingly rare, while the ranks of high-paying online gamblers continue to multiply. Some in the stone-gambling industry have even begun visiting jadeite experts in places such as Taiwan and Hong Kong to buy up rough jadeite originally sold before reform and opening-up, which they then take back to Ruili and resell to gamblers. Sellers in the city seem split as to whether the livestreaming boom is a good thing, or merely a short-term bounce, but there’s one thing everyone agrees on: Stone gambling is here to stay.

    Translator: Lewis Wright; editor: Cai Yiwen and Kilian O’Donnell; portrait artist: Wang Zhenhao.

    (Header image: Buyers inspect rough stones with a flashlight in Kunming, Yunnan province, 2018. IC)