WGC project aims to make gold more alluring to institutions
Fri Aug 29 2025
David Tait (pictured), chief executive officer of the World Gold Council (WGC), would like a gold coin for every time he’s asked where the gold price is heading.
“It’s a question I probably get asked six or seven times a day,” he says in an interview with Investor Strategy News. “And while I always stress it’s my personal opinion, I honestly can’t see a situation right now where the price will decline.
“We have various factors at play. There’s the classic macroeconomic story for gold if US interest rates fall. Then there’s the haven theme of everyone buying gold in times of upheaval, which is what we’re experiencing now.”
Both factors help explain why this precious metal has appreciated 26 per cent in the first half of this year in US dollar terms (it closed in Australia on Friday at $US3428.50 an oz), outperforming many major asset classes. As Louise Street, WGC’s senior markets analyst, comments, “Global markets have navigated a volatile start to the year marked by trade tensions, unpredictable US policy shifts and frequent geopolitical flashpoints, with the robust investment activity (in gold) underscoring its role as a hedge against economic and geopolitical risks.”
Important as these factors are, Tait says they are overshadowed by the threat of sovereign debt default that he believes is driving central banks to buy gold. “If it comes to a situation where there’s a lack of trust in the US bond market, that’s the Armageddon scenario. We briefly saw it when Trump first introduced his tariffs (in April), but (Treasury Secretary) Scott Bessent stepped in, and the bond market relaxed a little.”
That’s for now. But Tait can see a situation where bond markets are badly rattled … a “runway nuclear reaction” to use his words. These three arguments, sovereign debt, geopolitics and economic uncertainty, for the rise and rise of gold have been well aired. But it’s three Asian-related factors “clubbing together” that makes Tait even more bullish on gold. Relating to Japan, China and India, he believes developments in these markets are “massively underestimated”.
“In Japan, you’re seeing enormous demographic change accompanied by a massive wealth transfer to digitally aware younger generations who are experiencing inflation and a depreciating currency for the first time. When coupled with the geopolitical tensions in the region, it seems to me selling gold as an investment proposition is low hanging fruit.”
He says the China opportunity is evolving as their financial institutions liberalise. “We’ve been working with their insurance industry for nine years, slowly interesting them in gold. In January, the authorities allowed 10 insurance companies to have one per cent of gold in their portfolios – a huge step in the right direction. When you consider it’s a $US4.5 trillion market, and at one per cent that allocation can only go up, well, you do the maths.”
An India of 1.5 billion people is in the early throes of moving away from its traditional focus on jewellery and looking to other investment vehicles. “We’re seeing the ETF market grow massively in India,” he says, “with more than 20 opening to investors in the past six to eight months alone.” It’s now estimated the gold ETF market in India is approaching $US10 billion, fuelled by growing retail and institutional market demand as well as family offices.
For Tait, the demand side of the equation for gold is taking care of itself. What the WGC must do is facilitate a market transformation from gold’s “archine and legacy laden ways” to a modern, efficient market that makes this precious metal more accountable, transparent, trusted, accessible and secure, and, in doing so, a larger and more integral participant in the financial system and investment portfolios.
Huge lack of trust in gold
“When I joined the Council in 2018, I noticed a dislocated market, a fragmented market. I’m not saying the market didn’t work. It did. But when compared with other markets it was very anachronistic, very fragmented.”
It wasn’t just an issue of an antiquated market. As he said in a recent speech, “I (also) recognised a huge lack of trust in gold, both at a retail and institutional level, with WGC data showing that 50 per cent of people didn’t trust gold and that 60 per cent literally didn’t understand gold, its market, or how to safely access or invest in the asset.
“I also recognised both a confusing product, in terms of shape, size and purity, and a highly fragmented and unregulated global ecosystem.”
So, Tait and the organisation he heads has embarked on a crusade to digitise the market – the project is called Gold 24/7 – around three pillars: integrity, accessibility and fungibility (interchangeability).
This comprises building a gold integrity bar program that enables buyers to verify its provenance, a digitalised marketplace where it can be easily and safely traded and compete more effectively for investment capital, and digitalisation of gold based on developing a standard unit of gold that allows for fungibility.
This will open up a new investment paradigm for gold, he says. “Once gold can be truly tokenised (converted into monetary value), it can be used as financial collateral, and the Council is working with major regulators and treasury departments to progress this.”
Tait is convinced the implementation of Gold 24/7 will invigorate institutional interest in gold. “They will start playing in this market if the capital allocations they have to make to it are like other asset classes, because they’ll go where the liquidity and volatility is, because that’s where can make money.
“Right now, it demands too much investment to go there. So, I’m very positive on what we’re doing. Every single conversation I’ve had on this issue with every asset manager, the response has been the same – ‘Eureka’ – we’ve got another asset class to play with soon.”
Source: https://ioandc.com/