When Daewon, a Korean man who has been living in Beijing for over 10 years, saw the trending topic "chaoxie" on China's social media platform Weibo, he asked his Chinese colleague what the word meant. 

He was surprised to find out that it meant "speculate in the sneaker market" and that sneakers have become the hottest object of speculation in China, after Moutai liquor and digital currency. In fact, the market is more out of control than he imagined. 

Overpriced purchase

A pair of Air Jordan 1 "Obsidian" was priced at 2,029 yuan ($283) on Monday in DU, the biggest e-commerce platform for sneaker sales, while the official offering price on August 31 was 1,299 yuan. More than 11,000 transaction records show that most pairs were sold at around 3,500 yuan. 

Fashion designer Xiaodu started to collect sneakers four years ago. The most expensive pair cost him 5,000 yuan. "It was a pair of OFF-WHITE x Nike Air Force 1. The opening price in 2018 was 1,299 yuan, now it has surpassed 8,000 yuan," Xiaodu explained.

"With speculative traders jumping into the market, prices have gone up. Some real sneaker lovers cannot afford what they want," Xiaodu added. "If the price is much higher than the offering price, I wouldn't consider buying it."

His view was echoed by Chen Yue, who has collected more than 100 sneakers since 2009, but only 15 of them were bought at a higher price. Chen's first purchase was a pair of Air Jordans released in 2008. He bought them at 2,900 yuan, while the opening price was 1,280 yuan. 

Taizi Zhe goes much further when playing the "chaoxie" game. He is a veteran sneaker collector and seller based in Shenyang, capital of Northeast China's Liaoning Province. "I started to collect sneakers 20 years ago, and have worn near 2,000 pairs. Currently, I have more than 500 pairs at home."

The most expensive pair Zhe bought was the Undefeated X Air Jordan 4. There were only 72 pairs on sale that year. He bought it at 30,000 yuan and sold it at 90,000 yuan years later. Today, one pair is worth about 150,000 yuan.

Luck of the draw

At 2:00 am August 30, hundreds of people queued up in front of Silver Plaza in Ji'nan, capital of East China's Shandong Province. According to an official notice from a sportswear shop in the mall, 300 lucky draw tickets would be handed out to decide who had the right to buy the limited release shoes on August 31. 

Jiangnan's boyfriend wanted a pair of Air Jordan 1 "Obsidian", so the couple joined the throng of hopeful customers early in the morning. "We were not as prepared as the others. Some people brought stools, some slept in sleeping bags, some even brought folding beds. We just brought some newspapers," she said.

They waited almost five hours until 9:30 am when the shop began to hand out tickets, and were lucky enough to get two. But Jiangnan had no reason to celebrate just yet. "Getting a ticket doesn't mean anything, it just qualifies you to participate in the lucky draw. The rest is in God's hands." 

On August 31, Jiangnan and her boyfriend arrived at the mall on time. As the staff shouted out the winning numbers one by one, the winners jumped for joy while the others watched on in envy. However, it wasn't to be the couple's day. The sneakers they wanted had sold out before their numbers were called.

Profits come and go

Zhe started selling sneakers full-time in 2013. At the beginning, it was easy money, as there were no shoes that could not be sold. But he lost money too.

"It's a risky industry, because it's impossible to get a pair at the original price. So when you purchase overpriced ones, you need to make predictions on which style may rise in price, and which may go down. It's like gambling. You can't win all the time."

Now, Zhe sells sneakers on a variety of channels, including Taobao and Wechat, selling an average of 2,000 to 3,000 pairs per month. The most profitable pair was sold at 15,000 yuan while the purchase price was 1,299 yuan.

But for him, the golden age is already over. "When everyone finds it profitable and tries to get involved, it's the beginning of a recession. Think twice before you make the investment."

Be rational 

"Sneakers are for wearing, not for speculation." This is the most popular opinion among netizens, including Xiaodu.

He thinks that sneakers are worth collecting because of the story behind each style. But he doubts if there is potential for them to appreciate in value.

"There are too many bubbles. With the push from speculators and trading platforms, the price of any style could surge one night and plunge another," he lamented. "The prosperous yet unhealthy market is actually an illusion, because the number of real consumers is dropping. If the number of consumers continues to decrease, the bubble will finally go away."

Contrary to many people who feel that it's getting harder to buy popular sneakers, Chen Yue finds that it is actually getting much easier. 

"There are more cultural elements in sneakers. Ten years ago, the choices were very limited. But now you can buy commemorative items. During international events, such as the World Cup, or Olympics, the major brands will also release limited editions. You can even design your own unique sneaker in flagship stores."

"Don't always follow the trend, you will see how many choices you actually have," Chen said.

Zhe's sneaker collection Photo: Courtesy of Taizi Zhe

Taizi Zhe poses with his collection. Photo: Courtesy of Taizi Zhe