Page 14 - Bullion World Volume 03 Issue 07 July 2022

Bullion World | Volume 5 | Issue 09 | September 2025

World Gold Council and Linklaters LLP Launch a

Vision for the Next-Generation Gold Market

The World Gold Council, Linklaters and Hilltop The Wholesale Digital Gold ecosystem is designed
Walk Consulting have unveiled a pioneering to be technology-neutral, supporting initiatives like
vision to transform the global gold market through World Gold Council and LBMA’s Gold Bar Integrity
the introduction of Wholesale Digital Gold—a programme. It also optimises for regulatory compliance
transformative concept that will enhance how gold and capital efficiency.
is owned, traded, and utilised. In today’s wholesale
market, gold trades are settled in two main structures. To support this innovation, a new legal framework
The first is allocated gold which involves direct has been developed by Linklaters. This framework
ownership of specific physical bars but is operationally underpins the issuance and transfer of interests
complex; and the second is unallocated gold, which in a pool of vaulted gold bars, ensuring beneficial
has higher liquidity and lower costs, but may expose ownership of the physical gold held in custody. Core
investors to the credit risk of the institution where the participants in the Wholesale Digital Gold ecosystem
account is held. would co-own the underlying pooled gold and issue
digital fractional ownership interests in the gold,
Following on from the FMSB’s Precious Metals maintaining transparency and trust.
Spotlight Reviews1, and in consultation with key
industry participants; we propose a new way to settle Richard Hay, Partner and UK Head of Fintech at
gold, bridging the gap between these two structures. Linklaters, commented:
Pooled Gold Interests (PGI) combines the best of “We are proud to support the World Gold Council
both worlds by providing physical ownership, just and the broader industry in articulating their
like allocated gold, but with new benefits to investors exciting vision for a digital gold market through the
including: development of a new legal structure to support
• Broader and simplified use of gold, including as that vision. This structure provides legal certainty
collateral. and supports operational flexibility essential for
• Ownership of an interest in a pool of vaulted gold innovation in precious metals trading. By enabling
bars – even in small, fractional amounts. secure, transparent and efficient digital ownership of
• Easy and secure transfer of gold interests between fractional interest in gold, we are helping to unlock new
parties. opportunities for market participants and reinforcing
London’s leadership as the world’s preeminent gold
Mike Oswin, Global Head of Market Structure and trading hub.”
Innovation, World Gold Council commented:
“Wholesale Digital Gold is a vision to transform the Michael Voisin at Linklaters, commented:
way gold is owned and traded. The UK Government’s "We were delighted to build upon our track record of
recent publication on Financial Markets Digital Strategy delivering innovation in the financial markets through
highlights the importance of digitalising wholesale the design of a novel legal infrastructure supporting
markets to drive efficiency, resilience, and innovation— the vision for Wholesale Digital Gold. The vision and
an ambition that closely aligns with our own.” underpinning legal solution are also closely aligned
“As the world’s leading gold trading hub, with the with UK Government’s recently announced Wholesale
Loco London market clearing an average of 20 million Financial Markets Digital Strategy."
ounces daily, the UK is well positioned to lead the way
in improving the way gold is traded and cleared to the The World Gold Council invites market participants,
benefit of all market participants. Introducing a robust regulators, and technology providers to engage with
legal structure and innovative technology for gold this initiative and help shape the future of the gold
ownership and settlement, will only reinforce London’s market.
role in the global gold market.”

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