The Chinese gold market has been notoriously opaque over the past few decades, but thats now changing as its Shanghai and Hong Kong metals exchanges increase their visibility with new investment products and growing participation from Western banks, and its central bank is now reporting additions to its official reserves.

And while some analysts say the United Kingdoms June 23 vote to exit, or Brexit, the European Union will have few lasting global economic effects, investors in China apparently beg to differ. The most eye-catching sign of Chinas post-Brexit gold rush is the surging action in its major bullion-linked exchange-traded fund.

Heeding warnings of recession and contagion from numerous reputable sources, Chinese investors are rushing to gold as a haven after the U.K.s vote to quit the European Union, Bloomberg reported Monday.

Turnover inHuaan Yifu Gold ETF, Chinas top exchange-traded fund backed by bullion, jumped to a record 1.27 billion yuan ($191 million) Friday after Britains vote, the news agency added. Outstanding shares of Huaan also reached a record 1.6 billion on June 20, jumping five-fold from the start of the year.

Sharp uptick at Shanghai exchange: For the past few years we only saw tepid Chinese interests in these gold funds, Shanghai Leading Investment Co.s Shihua Duan told the agency. Now theres a surge and a lot of people havent realized that this surge is only the beginning.

China has always been crazy about physical gold such as jewelry and coins, to the detriment of its ETF industry. The current holdings of the top four such funds only total about 28 tons even after major inflows this year; Duan argued that that number should rise eventually to at least 600 tons.

Meanwhile, activity on the Shanghai Gold Exchange also erupted in the Brexit referendums wake. There has already been a sharp uptick in activity on the Shanghai Gold Exchange, the World Gold Council noted in a June 24 update. Trading volume spiked, reaching 346t compared to a daily average of close to 100t since the start of the year.

Hong Kong exports to mainland leap: In another sign of growing demand, Chinas imports from Hong Kong in May jumped to their highest level in five months, with 115 tons brought to the mainland for a 68% month-over-month increase and a 63% year-over-year rise.

Furthermore, in the leadup to the Brexit vote, Switzerlands gold exports to mainland China started rising, with a 36% month-over-month increase in May of 19 tons, while the 24 tons sent to Hong Kong almost tripled the previous months total.

The year 2016 has seen a topsy-turvy shift in gold-demand patterns. After a record level of gold consumption in China in January, Western investors who had forsaken gold in favor of stocks also found their way back to the metal as the U.S. stock market plunged early in the year. But Chinese demand appeared to ebb somewhat after the January peak, as did Western investment as equities stabilized. Now, though, with Brexits potential after-effects being felt globally, both Eastern and Western gold buyers seem to be returning simultaneously to the gold fold, and that bodes well for predictions of $1,400 and higher bullion prices.

The timing of the Brexit vote and outcome was fortunate in the sense that it gave the financial markets a full weekend to digest the news and gather their bearings. Now that markets have resumed trading in a new week, many investors are wondering what fallout from the Brexit vote they can expect to see in the coming weeks and months.

As far as the financial markets are concerned, look for them to remain volatile for some time to come. Stock indexes are likely to fall as equity investors recalibrate their expectations after the run-up before the Brexit vote. Certain sectors may suffer more than others, in particular the banking sector as Treasury yields slide and interest rates follow suit. A potential market rebound wouldnt be surprising at some point, when well-capitalized investors seek out bargains in the stock, currency or commodities markets. Moreover, gold prices may pull back after the recent strong rally to safety when some traders look to take profits from these gains.

Its likely that market uncertainty will prevail in the near term as the dust from the Brexit referendum continues to settle. Were already seeing some unexpected post-Brexit reactions ripple through the political world in the U.K., with leadership changes affecting both major political parties. This instability is likely to test market psychology in the coming weeks.

Plus, investors should remain wary of a potential unexpected, unforeseen disruption to the financial markets. Trading was reported to be stressful and hectic but relatively smooth on Friday following the Brexit vote. That is a positive sign of the resiliency of the financial markets. Should something out of the blue occur, it will probably rattle the already shaky nerves of investors. Events in the next few weeks will test how much resiliency markets really have and if they can continue to operate efficiently.

Political uncertainty in the U.K. and the European Union will likely not abate anytime soon. The Brexit result may motivate citizens with strong anti-establishment views in other countries to push for their own referendums on sovereignty and the future of political unions. In the U.K. itself, there has been plenty of political chatter in the wake of the Brexit vote of Scotland and Northern Ireland breaking with Britain and forging their own ties with the European Union. The map of voting results shows near overwhelming support for Remain among citizens in Scotland and Northern Ireland compared to England and Wales. (See map at right.) Outside of the U.K., strong anti-E.U. opposition already exists and may look to Brexit for inspiration for staging their own referendums. (Could a Frexit be around the corner for France?)

On the economic front, the effects of Brexit should land more heavily in the U.K., where economists are already predicting a significant slowdown in growth just stemming from the Brexit vote itself, before any changes actually occur with treaties or trade agreements. Ripples of an economic slowdown could wash up on E.U. shores, where Britain represents over 17% of the Eurozones gross domestic product. And because the U.K. is the fifth largest global economy, a drop in economic activity there could reach beyond Europe too, into the U.S. and Asia, although the effects arent likely to be as strong. How Brexit will really affect economic growth will likely remain uncertain for many months, because no one knows when Britain will actually start the formal process of E.U. withdrawal and what the outcomes of the new treaties and trade agreements will be. Differences in the expected timing of the exit are already apparent between Britain, where the process may be delayed until new leadership is in place, and the rest of Europe, where leaders from Germany and France have expressed their wishes for an earlier start to the U.K. formal withdrawal.

It will be interesting to watch the reaction to Brexit in other European countries and listen to how their leaders publicly discuss the future of relations with Britain. Many of these governments are facing elections of their own in the near future and fielding the passions of their sovereignty-minded citizens who have been energized by events in the U.K. These leaders may have an interest in making Britains abandonment of the European Union look difficult, and therefore an unattractive alternative to voters considering their own take on Brexit.

With all of this pervasive volatility and uncertainty, safe haven assets will continue to have an appeal to investors looking to downplay risk and protect their accumulated wealth.

The gold price has dipped from last weeks peak above $1,313 as fears of a Brexit have eased, but British investors continue to pile into the yellow metal for safety because Thursdays outcome remains highly uncertain.

Gold bullion demand surges in run-up to EU referendum, reported Londons Guardian newspaper, while a Belfast Telegraph headline read, Demand for gold rockets as investors seek stability.

Since June, the United Kingdoms Royal Mint has seen its online transactions rise 32% over Mays, while revenue exploded by almost 150%.

Possible turbulence, mint says: Overall since early 2016, demand for precious metals has risen, particularly with gold, mint official Chris Howard said. While we are uncertain at this stage on what impact the results of both the European referendum vote and the US elections will have on the gold market, with the Royal Mints trading platform and our significant gold holding, we are prepared for possible market turbulence.

The mints signature gold Sovereign coin has been one of its top sellers, Howard noted.

Gold investors stuffing safes: Meanwhile, citing Google search data, Londons Telegraph reported that worriedsavers are buying gold bars and stuffing them in safes at home, data suggests, as fears mount that a Brexit-induced financial meltdown could be just around the corner.

According to the Telegraph, the frequency of searches for the phrase home safe is reflecting crisis levels unseen since November 2008.

Meanwhile, Switzerland reports that the United Kingdom has been the biggest destination for Swiss gold exports this year, averaging over 60 mt/month since February, compared with average exports of less than 2 mt/month in 2015, the Platts news agency noted, citing growing investment demand.

As of Wednesday, the outcome of the Brexit vote to leave the European Union remains too close to call. An Opinium poll found the Leave camp leading slightly at 45% versus 44% for the Remain faction, with the rest undecided.

Negative rates bigger than Brexit: Gold skeptics think that the metals price could take a hit if the Brexit movement fails, but at least some analysts say bullion can benefit either way.

I think gold is a buy here, David Davitt of Harvest Volatility Management told CNBC on Tuesday. As we move toward these negative rates, you put dollars in a vault, theyre going to start destroying each other. Theres a possibility if you invest dollars that youll get less dollars back in a years time. So the lack of yield on gold had long been an argument, but if negative yield is throughout the economy, then gold synthetically has a positive yield.

And Rich Ross of Evercore ISI agreed, saying that whether Britain Brexits or Bremains, gold should brenefit. Ross noted that golds 20% gain this year largely occurred in the first six weeks of the year, only to be relatively rangebound since then, so Brexit wont take away that early-year advance. I think that gold works whether we get that Brexit and chaos ensues gold goes higher or if peace prevails on the Bremain, the dollar eases, providing a bid into gold and commodities, high yield, etc. So I like it either way.

Bill Baruch of iiTrader also concurred with the win-win scenario for gold, predicting in a Bloomberg interview, Golds going to be a lot higher after a Brexit. And if they vote to stay, the dollar will weaken and gold will hold ground, he said. Over the longer run, I do expect gold to be testing $1,400 by the end of August. I think theres a lot of value in this area near-term and into the long term.

Although the gold price might lose ground after a potential Remain vote victory, the metal has strong support well above $1,200. Therefore, a Brexit failure could provide gold investors with a key strategic buying opportunity.

The extremely articulate and savvy hedge fund manager Kyle Bass was quoted in 2013 saying, At some point in time I’d much rather own gold than paper. I just don’t know when that time is.

Like Kyle, many people desire to own gold based solely on the ostensibly inevitable, yet always hypothetical, doomsday predictions that call for widespread pandemonium and chaos that will ultimately render the major currencies of the world obsolete and better suited for fire starting purposes to stay warm.

However, perhaps there is a more realistic and plausible reason to own gold.

Many successful investors will often credit their success, in part, to diversification. Having assets appropriately allocated in the usual allotment of stocks, bonds, and gold ensures that a portfolio is in better shape to withstand the harshest economic times imaginable. This alone is a highly convincing argument to own gold. In spite of the idea of hedging equity or fixed-income investments, owning gold also ensures that an investor literally has exposure to the gold marketplace.

Unequivocally, the key difference between gold and any monetary currency in the world, like the American dollar, the euro, the rand, etc., is the unavoidable fact that gold cannot be duplicated. Therefore, at its very core, the fundamental law of supply and demand ought to be enough to convince everyone to own gold. Regardless if you are looking to achieve a well-balanced investment portfolio across different asset classes or are simply buying gold coins, the fact of the matter is you are gaining exposure to a market with a limited supply. But what does this entail?

Unlike virtually every paper currency in the world, it is a certainty that central banks, or anyone for that matter, simply cannot print more gold. What is not a certainty, however, is the population of the world remaining stagnant and slow-growing for years to come. In fact, this is highly unlikely; common sense and history underscore the relationship between increased time and increased population growth.

Because of this, from the most basic level, we know two certainties when talking about gold:

1. There is a finite amount of gold in the world.
2. The population of the world is constantly increasing.

As the population increases, there will be less gold for more people, and this will result in the willingness, if not the necessity, to pay more in order to own gold. It really is that simple. The supply and demand of gold, which is ultimately a major determining factor of its price, is clearer than almost any other commodity. Moreover, from a usage standpoint, gold will stay important and relevant into perpetuity because of its financial uses, whereas a commodity like crude oil will likely face dwindling demand moving into the future as alternative fuel sources become more prevalent.

Naturally, because all of these facts lead to a logical conclusion, this raises the unavoidable question of why everyone in the world doesn’t realize this and own gold?

As it turns out, most sophisticated investors do indeed maintain a position in gold. As Kyle Bass explains again, we’ve always had a position in gold. It is important to note that if you want to have a position in gold like many prominent hedge funds and institutions, it need not be through gold futures, an ETF or other investment vehicle. Owning gold in its physical state of coins, bars or bullion is just as effective in regards to market exposure, because this is what the electronic forms of gold investing are based on, and its undeniably more exciting.

Although there seems to always be chatter of needing to own gold as insurance for the day fiscal policy globally collapses, a far more likely scenario is that gold, over time, will increase in value due to the basic laws of supply and demand and those who do not own it will miss out on an a lovely investment and diversification asset.

Some new financial heavy hitters have come out of the woodwork to emphasize that a Brexit could devastate various aspects of the British, European, and even global economies.

Billionaire George Soros penned a column in Londons Guardian newspaper predicting that a vote to leave could see the week end with a Black Friday, and serious consequences for ordinary people.

And famed British banking scion Lord Jacob Rothschild has warned that a Brexit would be damaging and disorderly, while New York University economist Nouriel Roubini said the United Kingdom would suffer significant damage.

SocGen predicts 10% gold advance: And given these projected negative economic consequences, gold would be a likely beneficiary of Brexit. Thats why one banking giant that has been a longtime bear on the precious metal is forecasting a significant move higher in the gold price if the Brexit backers prevail.

In the event of Brexit, we expect gold to move 10% higher and volatility to increase significantly, Societe Generale analysts wrote. The heightened market uncertainty in the run-up to the vote will prompt investors to seek safe-haven assets, benefiting gold and the rest of the precious metals.

A 10% increase would take gold above the $1,400 level. Thats quite a forecast given SocGens recent dislike of gold. As Bloomberg metals analyst Eddie van der Walt tweeted, Bears SocGen say gold could go to $1,400 on Brexit. Thats like anyone else saying $1,700.

All of the problems are here to stay: But as another SocGen analyst notes, even if the Brexit measure is defeated, problems remain for the global economy that will keep golds safe-haven qualities in high demand.

Whatever the outcome of the Brexit vote this week, investors will still be facing the prospect of negative rates and negative yields on a huge range of bonds, massive corporate leverage with worryingly rising delinquencies and of course expensive equity markets and falling profits, Andrew Lapthone wrote. To that extent these political events are a distraction from the main event, weak global economic growth and perverse asset markets. So whilst the market preference for the status quo might be celebrated in the short-term, actually when the fog clears, all of the problems will still be there.

And those problems also exist in the U.S. As Bill Bonner succinctly put it, Industrial production has been falling for nine months in a row. Factory orders have been going down for the past 18 months. Commercial bankruptcies are rising. And tax receipts are beginning to fall, as they typically do before a recession.

More than $10 trillion of government bonds now trade at negative yields. And another $10 trillion or so worth of U.S. stocks trade well above their long-term average valuations.

And theres more than $200 trillion of debt in the world with about $60 trillion added since the global financial crisis.

Is Brexit paranoia just noise?: This litany of problems is one reason why Barry Dawes of Paradigm Securities just told CNBC that the yellow metal is bound for new 2016 highs regardless of the UK referendums outcome. There are other forces that are affecting the gold price, Dawes said. I just see this Brexit issue as just noise. Its not a major issue. Some people have made it out to be a lot more than I really think it is. The gold price was moving up quite nicely early in the year long before this Brexit issue really came to the fore, so sure, well see a little volatility. We got up to that sort of $1,350 which was my target from earlier in the year, and I think weve probably got a little bit more consolidation before we go and then I think its going to be up, and well certainly see $1,400 on my models this year, and it could be a lot higher than that.