Chinese investors come out to mass protests. For example, on July 10, thousands of people came to the branch of the People's Bank of China in Zhenzhou, since their deposits in 4 banks have been frozen since April:Yuzhou Xinminsheng Village;Zhecheng Huanghuai Community;Shangcai Huimin County;New Oriental County Bank.How it happened: why depositors lost access to their savingsThere are a lot of regional private banks in China, they are also called "rural". According to the law, they must carry out their activities exclusively "at the place of residence". But in practice, this did not prevent them from attracting deposits from people from all over the Middle Kingdom through online platforms - including Du Xiaoman Financial and JD Finance, owned by Baidu and JD.com . And the authorities just turned a blind eye to it.However, recently the national regulator accused a major shareholder of the four listed banks, Henan New Fortune Group, of illegally attracting depositors' money.Did Covid hit the discontented?The authorities, alas, are clearly not on the side of the victims.The first protests took place back in May, the next action was to take place in mid-June - cheated depositors from all over China were going to come to it. But then their electronic "health codes" suddenly changed from green to red, which means that a person is sick with covid and must stay at home in quarantine. So it didn't work out to get together.Well, at the rally on July 10, the security forces, both in uniform and in civilian clothes, penetrated into the crowd and began beating the protesters.But what about deposit insurance?In banks, customers were told that deposit products were legal and protected by the deposit insurance system. In China, deposits of 500,000 yuan (~$75,000) are guaranteed in case of bank bankruptcy. But if a government investigation finds the deposits "not in accordance with the law," then the depositors will never see their money.It is also unknown who exactly has to pay the debts of "rural" banks: local authorities or central ones? However, after the latest protests, it was reported that the first payments to victims of the banking industry should take place this Friday.What is happening in China in July 2022?Social tension in China is growing, and more and more often you can hear about the clashes of the population with the authorities: people are locked up in factories, then they do not give out deposits. But the 20th Party Congress is on the nose.China is not such a communist country. When it comes to financial pyramids and the interests of banks, such a draconian version of capitalism is flourishing in the country that Wall Street is resting.So far, the protests are centered around four small banks. In total, there are about 4,000 such "banks" in China, which collectively control assets worth $14 trillion. But who are they lending to? What if the problems of the first 4 swallows are directly related to problems in the real sector?For example, the combined sales of 100 leading developers have already "collapsed" by half, the construction sector (30% of China's GDP) can pull the entire Chinese economy with it. And this, in turn, is able to "test the strength" of a larger number of banks and the entire deposit insurance ...