The tokenisation of physical gold has the potential to improve efficiency, settlement and collateral management in UK wholesale markets. However, questions remain around ownership rights, custody, regulatory classification and investor protection.

On 14 September 2026, the Financial Conduct Authority (FCA) published a Call for Input on the opportunities and risks associated with the use of tokenised gold in UK markets. It follows wider work with the Bank of England on the future of tokenisation in wholesale financial markets.

The FCA is seeking industry views on how tokenised gold could be used in practice, the regulatory challenges it presents and whether further guidance or changes to the existing framework may be required.

With responses closing on 23 October 2026, firms developing, issuing, holding or considering tokenised gold products have an opportunity to contribute to the FCA’s approach.
In this article, we examine the key regulatory considerations and practical steps firms should consider when assessing their exposure and preparing a response.

What is the FCA seeking views on?

Tokenisation involves creating digital tokens that represent ownership of physical gold, allowing ownership rights to be transferred electronically.

The FCA is exploring whether this approach could address some of the operational challenges associated with traditional gold markets, particularly where the transfer of gold and settlement of payments take place through separate systems.


The scope is narrow. The Call for Input focuses on tokens representing ownership rights in physical gold, with transparent backing, clearly defined rights and reliable redemption. The FCA is not proposing to bring the wider gold market within its regulatory perimeter. Itis considering how tokenisation could support innovation while maintaining market integrity, in particular anti-money laundering (AML) protections.


The FCA’s five questions cover: the benefits and risks of tokenised gold; interoperability and trusted collateral; whether some structures should sit outside the CIS/AIF regimes; where further regulatory clarity is needed; and how gold projects should connect with wider wholesale-tokenisation initiatives.

Key regulatory considerations for tokenised gold

Wholesale collateral

One of the potential benefits identified by the FCA is the use of tokenised gold as possible collateral for securities lending, repurchase agreements and derivatives.

Traditional gold arrangements present different challenges. Allocated gold provides ownership rights over identifiable physical gold but can be more complex and costly to transfer. Unallocated gold is easier to transfer, but it exposes holders to counterparty risk because they generally hold a contractual claim against the account provider.

Tokenisation could provide an alternative by enabling more efficient transfers of ownership. It could also support delivery versus payment arrangements, where the transfer of an asset and corresponding payment are linked.

However, its effectiveness as collateral will depend on the legal and operational arrangements supporting the token. Firms should consider:

  • how gold tokens are treated in insolvency;
  • whether a secured party can take control of the asset and sell it;
  • when an on-chain transfer becomes final;
  • how on-chain records reconcile with vault records.
  • A collateral receiver will want clear answers to each of these before accepting a token, so firms that can evidence them will find it easier to get their tokens accepted.

These considerations are particularly relevant for firms assessing whether tokenised gold can be incorporated into existing collateral management and risk frameworks.

Interoperability

For tokenised gold to operate effectively across wholesale markets, firms need confidence that tokens can be transferred, accepted and used across different platforms and market participants. If every issuer’s gold token only works on its own platform, firms may need to maintain separate pools that cannot easily be swapped or moved. The FCA calls this fragmenting liquidity. The technical term for the fix is interoperability, meaning different tokens and systems can work together.

The FCA wants industry, not regulators, to write the common standards and provide their views. Areas under consideration include ownership records, issuance and redemption processes, custody arrangements, audit and attestation, cyber security and operational resilience. For regulated firms, these questions extend beyond technology. They also raise important considerations around third-party risk management, governance and accountability.

Regulatory classification and perimeter considerations

One of the more complex issues raised by the Call for Input is how tokenised gold products should be classified under existing UK financial services regulation. The regulatory treatment will depend on the legal and operational structure of each product, and more than one regime may apply. The FCA says uncertainty around the collective investment scheme (CIS) and alternative investment fund (AIF) perimeter may be affecting the development of some tokenised gold projects.

  1. Investment schemes and funds – Certain tokenised gold arrangements may fall within the definition of CIS or AIF , particularly where investors participate in pooled arrangements where assets are managed together for several people. However, the analysis depends on the legal and operational structure, including whether token holders have direct ownership or co-ownership rights. That could bring extra authorisation, disclosure and supervisory requirements, and limit who a firm can sell it to.
  2. Qualifying cryptoassets – A token that is not a fund may still fall within the UK’s evolving cryptoasset regulatory framework. The FCA’s final cryptoasset perimeter guidance, published on 16 September 2026, provides further clarity on the activities and arrangements that may require authorisation under the new regime. The regime is due to take effect on on 25 October 2027. The application period for firms seeking to benefit from the transitional arrangements opened on 30 September 2026 and closes on 28 February 2027. Where relevant activities fall within the new regime, firms should assess their authorisation requirements and the implications for existing governance, systems and controls.
  3. Arrangements outside these regime Some tokenised gold structures may fall outside the CIS, AIF or qualifying cryptoasset definitions. However, this does not necessarily mean that all associated activities fall outside financial services regulation. Other requirements, including applicable financial promotions, anti-money laundering and financial crime obligations, may still be relevant depending on the activities undertaken. The FCA is considering whether additional guidance or targeted regulatory changes could provide greater clarity, particularly where existing requirements may overlap. For firms developing tokenised gold products, a documented regulatory perimeter assessment will be an important starting point.

Retail disclosure

The FCA has also highlighted the importance of clear and consistent information about the rights and protections associated with tokenised gold.Practice in tokenised gold is inconsistent, unlike the gold exchange-traded fund (ETF) market. Firms should consider whether their product documentation clearly explains:

  • how the gold is stored and insured;
  • whether and how they can redeem;
  • how far the product is regulated;
  • fees and minimum amounts;
  • what happens if an issuer, custodian, vault, technology provider or intermediary fails.

Firms considering retail distribution should also assess the applicable financial promotions framework and, where the product or service is within scope, the Consumer Duty. Clear disclosures are important, but firms must also consider whether product design, target-market assessments and distribution arrangements are appropriate for the intended customers.

What happens next?

This call does not stand alone. On the same day, the FCA and Bank of England published feedback on their May 2026 Call for Input on wholesale tokenisation. Firms asked for clarity on capital treatment and on whether tokenised assets can be used as collateral. A joint roadmap with target dates is due later this year, so gold is one part of a larger programme.

The FCA has not put forward firm policy proposals at this stage Instead, it is considering a range of potential measures, including: a good and poor practice note; guidance on existing rules; an “eligible gold token” classification; targeted rule or legislative changes; and a bespoke regime for tokenised gold or tokenised commodities. The feedback received will help determine whether further regulatory intervention is necessary and what form it may take.

Five key considerations ahead of the 23 October response deadline

Firms involved in tokenised gold, or considering its potential use, should assess the implications for their business and whether they have evidence or experience that could inform the FCA’s approach.

We recommend focusing on five key areas:

  1. Map your exposure – Identify whether your firmissues, holds, custodies, distributes or accepts tokenised gold as collateral, or plans to undertake these activities
  2. Review the regulatory perimeter – Assess the legal and operational structure of relevant products, including whether they may fall within the CIS, AIF or qualifying cryptoasset regimes and document the rationale for the assessment.
  3. Evaluate the legal chain – Review the rights attached to tokens, and consider how ownership and collateral rights would operate in practice, particularly in an insolvency scenario.
  4. Review financial crime and market integrity controls –  Review applicable financial crime controls, including customer and counterparty due diligence, transaction monitoring, wallet and blockchain analytics, sanctions screening, unusual activity outside conventional market hours, and how controls operate across issuers, custodians, vaults and intermediaries.
  5. Prepare an evidence-based response– The FCA is seeking practical evidence to inform its future approach.. Responses are likely to be most useful where they include evidence from pilots, operational data, identified barriers and specific proposals, rather than general statements of support.

How fscom can help

As the FCA considers the future regulatory approach to tokenised gold, firms should assess how their existing governance, risk management and compliance frameworks may apply to these emerging products.

fscom’s Capital Markets and Asset Management specialists support firms with regulatory perimeter assessments, governance and compliance reviews, financial crime controls, operational resilience and third-party risk management.

We can also help firms identify the regulatory considerations relevant to their proposed activities and prepare evidence-based responses to the FCA’s Call for Input.

With the response deadline approaching on 23 October 2026, firms have an opportunity to contribute to the development of the UK’s regulatory approach to tokenised gold.

To discuss how these developments may affect your firm, get in touch with our team.

This post contains a general summary of advice and is not a complete or definitive statement of the law. Specific advice should be obtained where appropriate.