World Gold Council Launches Gold-Backed Tokens in London
- World Gold Council launches Pooled Gold Interest tokens in London.
- The initiative aims to digitize a multibillion-dollar gold market.
- Involves key financial institutions like HSBC and JPMorgan.
The World Gold Council announces the launch of Pooled Gold Interest tokens in London, aiming to modernize the $930 billion gold market through digital ownership, set for 2026.
This initiative may transform gold trading by enabling on-chain settlements, though it faces industry skepticism and modest impact on larger crypto markets.
The World Gold Council is introducing Pooled Gold Interest tokens, backed by physical gold stored in London, targeting institutional investors starting early 2026.
This marks an advancement in the gold market’s digitization, potentially impacting liquidity and asset management options significantly.
Pooled Gold Tokens Launched for Institutional Investors
The World Gold Council (WGC) launches Pooled Gold Interest (PGI) tokens, backed by physical gold in London, aimed at institutional investors. This initiative seeks to modernize the longstanding London gold market. Key players, including major banks like HSBC and JPMorgan, involve in the project. The initiative reflects WGC’s ongoing effort to bring compliance-driven tokenization to the forefront.
Institutions Eye Gold Tokenization for Asset Management
The announcement is expected to affect the gold market’s liquidity, potentially opening new collateralization uses. Institutions view tokenization of gold as a promising evolution for asset management. Mike Oswin, Global Head of Market Structure and Innovation at the World Gold Council, stated,
“This is a way to be able to get into the market, hold a digital representation of gold with full legal entitlement, with full confidence that the gold is there.”
Initial reactions indicate a mix of support from institutions aiming for real-time settlement benefits, while others show caution, questioning the necessity given gold’s traditional value stability. Adrian Ash, Research Director at BullionVault, remarked that
“Gold is already the best performing asset class. This feels like solving a problem that doesn’t exist.”
Examining Previous Gold-Backed Digital Initiatives
Previous attempts at gold-tokenization, like XAUT and PAXG, faced adoption and trust challenges. WGC’s past efforts like the Gold Bar Integrity Program saw limited engagement, highlighting industry conservatism. Experts suggest that if successful, the PGI initiative could shift dynamics similarly to gold ETFs, though gold’s established market poses unique hurdles not seen in purely digital assets.
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