UK FCA Seeks Input on Tokenised Gold in Wholesale Markets

The UK Financial Conduct Authority is seeking industry views on whether tokenising gold could improve how the metal is traded, transferred, pledged and held in wholesale markets. The regulator’s call for input examines potential benefits, legal questions and consumer-protection risks before the UK develops its policy approach.

What the FCA Is Asking

The FCA published its Call for Input on tokenised gold on September 14, 2026. It wants evidence on whether distributed-ledger technology can make gold markets more efficient and competitive while maintaining market integrity and consumer protection.

Tokenised gold generally means digital tokens that represent ownership rights in physical bullion held by an issuer, custodian or vault operator. The token can potentially be transferred electronically while the underlying metal remains in secure storage.

The regulator is particularly interested in wholesale use cases, product structures, operational standards and the relationship between tokenised gold and existing collective investment scheme or alternative investment fund rules.

Potential use	Possible benefit	Question for policymakers
Wholesale collateral	Faster movement and improved collateral mobility	How should ownership and enforcement work?
Settlement	Programmable delivery-versus-payment transactions	How can token records reconcile with custody records?
Retail investment	Fractional access and lower transfer friction	What disclosures and protections are necessary?
Digital custody	Clearer ownership records and automated controls	Who is responsible if an issuer or vault fails?

Gold as Digital Collateral

The FCA sees possible applications for tokenised gold in securities lending, repurchase agreements and derivatives markets. Digital tokens could allow collateral to move faster between counterparties and reduce manual reconciliation.

Tokenised gold may also support delivery-versus-payment transactions, in which gold tokens are exchanged for tokenised cash or another digital asset. Programmable settlement rules could reduce timing mismatches and operational friction.

For the model to scale, market participants would need reliable ownership records, consistent token standards, secure custody, independent audits and interoperability between traditional and distributed-ledger systems.

Prudential treatment is another open issue. Banks and other regulated institutions need to know whether tokenised gold qualifies as collateral, how it is valued and what happens during market stress or a counterparty default.

Potential Retail Applications

Tokenisation could make gold more accessible to retail investors through fractional ownership and lower transaction thresholds. Digital transfer could also allow investors to move or use gold exposure outside traditional market hours.

New products could combine gold exposure with programmable features, digital wallets or collateral functions. Those benefits may make gold-based products easier to integrate into broader digital finance platforms.

Retail access also increases the need for clear disclosures. Investors should understand whether they own physical bullion, a beneficial interest, a fund unit or only a contractual claim against an issuer.

Tokenised gold products may differ in redemption rights, fees, minimum investment, custody arrangements and treatment if a technology provider, issuer or vault operator becomes insolvent.

The Legal and Operational Risks

The FCA identified questions around ownership rights, insolvency treatment, collateral enforcement and settlement finality. A token record must connect reliably to the legal claim over the underlying gold.

Physical custody creates another layer of risk. Issuers and vault operators must maintain accurate inventories, protect bullion, manage insurance and reconcile digital tokens with the amount of gold held.

Technology risks include smart-contract vulnerabilities, private-key compromise, network outages and attacks on wallets or custody systems. A token may continue to exist on-chain even if the underlying redemption process is disrupted.

Market integrity and consumer protection also depend on disclosure standards. Investors need information about the vault, auditor, issuer, redemption process, regulatory status and the consequences of failure.

The FCA is considering whether guidance, perimeter clarification or targeted exemptions could support innovation without weakening protections. Any alternative framework would still need strong standards for governance, resilience and market conduct.

What Happens Next

The call for input closes on October 23, 2026. Responses will help the FCA assess whether gold tokenisation requires a specific regulatory approach and how it should interact with wider UK work on wholesale-market tokenisation.

The initiative follows a joint FCA and Bank of England call for input on the future of tokenisation in UK wholesale financial markets. Respondents identified post-trade activity, particularly the movement of collateral, as a major opportunity.

London is the world’s largest centre for spot gold trading, giving the UK a strong commercial reason to explore digital gold infrastructure. The FCA wants to understand whether tokenisation can preserve that position while supporting safer and more efficient settlement.

Any future framework will likely need coordination among the FCA, HM Treasury, the Bank of England, bullion-market participants, custodians, technology firms and investor groups.

Bottom line: The FCA is gathering evidence on whether tokenised gold can improve wholesale collateral, settlement and ownership records. The opportunity is significant, but legal ownership, custody, redemption, insolvency and consumer-protection questions must be resolved before the market can scale safely.

Read the official FCA call for input, download the consultation PDF and review Reuters coverage.