World Gold Council Launches Digital Gold Pilot in London Market - Historic Shift for Traditional Asset Class
Gold goes digital—finally.
The World Gold Council just dropped a bombshell: London's institutional market is about to get its first taste of digitized bullion. This isn't some theoretical whitepaper—it's a live pilot that could reshape how the oldest safe-haven asset moves through modern finance.
Why This Matters
Institutional gold trading has been stuck in the analog age while everything else went digital. The Council's move signals that even the most traditional players recognize blockchain's efficiency gains—instant settlement, fractional ownership, and transparent audit trails that make paper certificates look medieval.
London's Legacy Meets Distributed Ledgers
The pilot leverages London's existing gold infrastructure while layering on digital rails. Think physical vaults with tokenized ownership—because apparently it took gold traders 15 years to realize what crypto natives figured out in 2009.
Market Impact
This could unlock billions in dormant gold assets for DeFi lending, collateralization, and seamless cross-border transfers. Suddenly that gold sitting in vaults becomes programmable, composable capital—exactly what institutional portfolios need in an increasingly digital economy.
The irony? Gold traditionalists spent years dismissing Bitcoin as 'fool's gold' while quietly building their own digital version. Maybe store-of-value arguments aren't so different after all—just slower.
Digital claims on physical gold
Under the proposed model, PGIs will represent a co-ownership interest in gold held in segregated accounts by London’s major clearing banks and trading houses. Instead of transferring whole bars, participants WOULD be able to move digital units instantly, cutting down on settlement friction in the over-the-counter (OTC) market.
Each interest would be structured via a trust and recorded digitally, enabling faster collateralization and potentially unlocking gold’s use in repo and lending markets.
David Tait, chief executive of the World Gold Council, said the aim is to change how investors view the metal.
According to Tait, gold is viewed as static and non-yielding by investors. However, with digitization, it can become an income-generating asset, especially for banks, where it can be used as collateral.
World Gold Council trades tradition for disruption
The MOVE is seen as opportunity but there’s also tension about changing a centuries-old process in London’s gold market, which still clears trades largely through an opaque system of allocated and unallocated accounts.
The WGC has already tried out blockchain technology through its Gold Bar Integrity program, which it launched in collaboration with the London Bullion Market Association (LBMA) to track chain of custody, provenance and authenticity.
Many global refiners have reportedly signed up, with about 96% of those on the LBMA’s good delivery list on board, according to Ruth Crowell, LBMA chief executive. However, implementation across the supply chain has been slow.
The WGC argues that digitization will help gold compete with cryptocurrencies and stablecoins, which have offered investors liquid, blockchain-based alternatives to physical assets.
With institutional demand for digital settlement rising, proponents believe PGIs could bridge the gap between traditional bullion and emerging financial technologies.
The timing could be right
The push comes at a time of record gold prices, which have more than doubled in three years amid geopolitical uncertainty and strong central bank buying. The London over-the-counter (OTC) market, the world’s largest, clears the equivalent of $900 billion in gold trades annually; the scale of potential disruption is very high when this is taken into consideration.
Analysts say expanding gold’s role as collateral could enhance liquidity in short-term funding markets and also give investors more flexibility in deploying the asset.
Despite the enthusiasm from the WGC, not all in the bullion industry are convinced. Critics argue that gold does not require digitization to remain relevant.
“Gold is already the best performing asset class over the long run,” said Adrian Ash, director of research at BullionVault. “This feels like a solution in search of a problem.”
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