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U.K. FCA prepares tokenized gold rules for wholesale collateral use

U.K. FCA prepares tokenized gold rules for wholesale collateral use

The regulator is weighing standards that could let tokenized bullion serve as collateral in wholesale markets as Britain pushes a broader plan to expand tokenized securities and digital market infrastructure.

Fact Check
Three independent secondary news sources, all citing the Financial Times, consistently report that the FCA is consulting industry groups including major banks to develop a tokenized gold regulatory framework, with standards expected in the coming months to support London's gold market. The claim's key elements—regulator, industry consultation, timeline, and purpose—are corroborated across all sources.
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Summary

The U.K.'s Financial Conduct Authority has held talks with banks and other industry participants on potential rules for tokenized gold and has sought feedback on whether tokenized bullion could be used as collateral in wholesale markets, according to the Financial Times. The regulator is preparing to outline new regulatory standards for tokenized gold, a move that would help determine how digital claims on physical bullion fit into institutional market infrastructure. The effort matters because London is the world's largest over-the-counter gold trading hub, accounting for about 70% of global notional gold trading volume, according to the World Gold Council. The discussions also align with a wider U.K. push into tokenized finance after a government-backed industry task force said in July that tokenization could add as much as 33 billion British pounds ($44 billion) to annual economic output by 2035 and called for the country's first tokenized government bond by early 2027, with tokenized securities usable for trading, settlement and collateral.

Terms & Concepts
  • tokenized gold: Digital tokens linked to physical gold, designed to let ownership or claims on bullion move through digital market infrastructure.
  • wholesale markets: Financial markets used mainly by institutions, such as banks and large investors, rather than retail customers.
  • collateral: Assets pledged to secure financial exposures, helping reduce counterparty risk in trading and lending transactions.