UK regulators develop framework for tokenized gold

The UK’s Financial Conduct Authority (FCA) is developing a regulatory framework for tokenized gold to modernize the nation's financial markets. The regulator has held discussions with major banks and industry participants regarding the use of blockchain-based gold products, specifically exploring whether these digital assets can serve as collateral in wholesale markets.

This initiative aims to defend London’s position as a premier global bullion hub. London currently accounts for approximately 70% of the world’s notional gold trading volume. The push for digitization comes as competition intensifies from Asian financial centers, including Shanghai and Hong Kong.

The proposed framework is part of a broader effort to integrate distributed ledger technology into trading, settlement, clearing, and custody services. The Bank of England’s Prudential Regulation Authority is also expected to participate in formulating these policies. Regulators aim to provide the legal and operational clarity necessary for institutional adoption of real-world asset (RWA) tokenization.