FCA Wants Tokenized Gold Rules Before London Loses Its 70% Shine ✨

The UK's Financial Conduct Authority is preparing new regulatory standards for tokenized gold and has sought industry feedback on using the assets as collateral in wholesale markets, according to people familiar with the matter cited by the Financial Times. The FCA has held talks with banks and other market participants as it drafts the framework. Cointelegraph has approached the FCA for comment.

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 regulator's effort comes as competition in gold trading grows from hubs including Shanghai and Hong Kong.

The framework builds on a May 18, 2026 joint paper from the FCA, the Bank of England and the Prudential Regulation Authority, which identified tokenized gold and tokenized money-market funds as collateral candidates under UK EMIR rules. Both would receive the same prudential treatment as their traditional counterparts in uncleared OTC derivatives markets, where collateral efficiency affects how much capital institutions must post.

Tokenized gold products are digital tokens backed by physical gold held in custody. The FCA's consultations are examining whether the instruments could be treated as eligible collateral alongside existing wholesale assets.

The push is part of a broader UK initiative to expand tokenized financial markets. A government-backed industry task force said in July that tokenization could add as much as 33 billion British pounds ($44 billion) to the UK's annual economic output by 2035. The roadmap also calls for the UK's first tokenized government bond by early 2027 and seeks to make tokenized securities usable for trading, settlement and as collateral.