FCA opens Call for Input on whether tokenised gold should sit outside UK fund rules
Updated: Oct 7
The Financial Conduct Authority has opened a Call for Input on whether some tokenised gold products should sit outside the UK's fund rules altogether, as part of a wider push to keep London at the centre of global bullion trading.
The FCA published the Call for Input on 14 September, working alongside the Treasury and the Bank of England. It closes on 23 October 2026.
What is being considered
Tokenised gold consists of digital tokens that confer ownership rights in physical bullion held by an issuer or custodian. The metal itself stays in a vault; the tokens representing ownership can be transferred electronically. Industry participants have told the FCA that uncertainty over whether these products fall inside the UK's collective investment scheme and alternative investment fund regimes is limiting the range of investors able to hold them.
One option under review is a targeted exemption from those fund regimes for tokenised gold specifically, or potentially for tokenised commodities more broadly. No final decision has been taken, and officials have said they remain open to different models, including a bespoke regime developed jointly with the Treasury and the Bank of England.
The review is focused on products that represent ownership of physical gold with transparent backing, clearly defined ownership rights and reliable redemption arrangements, rather than more loosely structured derivatives or synthetic exposures.
Existing authorised funds are already permitted to invest in tokenised versions of eligible assets. This is a narrower and more specific question: whether certain gold backed tokens, or the market infrastructure supporting them, should be carved out of fund style regulation altogether so they can circulate more freely in wholesale markets.
Why gold, and why now
Jon Relleen, the FCA's director of infrastructure and exchanges, has said tokenised gold emerged as a specific point of interest in the regulator's ongoing conversations with market participants. London already accounts for a large share of global gold trading, and supporters of the proposal argue that tokenisation could make it simpler to divide, move and pledge bullion as collateral, without the operational friction of physically transferring bars between vaults.
Regulators have previously flagged tokenised gold as a possible form of collateral for uncleared over the counter derivatives, provided industry standards are developed to support it. The Bank of England is separately considering, as part of broader work, whether tokenised assets, including certain stablecoins, could be accepted as collateral within its Sterling Monetary Framework and by central counterparties.
Any exemption that emerges is expected to be narrow. Tokenised gold would still be subject to other regulatory requirements covering custody, market integrity and financial crime, even if it sits outside the fund regimes. Critics of a blanket carve-out have also noted the risk of treating what is, in substance, a simple claim on allocated metal as something other than the pooled investment vehicle it can resemble in practice, if the drafting is not precise.
Why it matters for the UK
This Call for Input sits alongside the FCA and Bank of England's Feedback Statement on wholesale tokenisation, published the same day and covered separately on Tokenising Startups. Read together, the two publications suggest a regulator willing to extend its tokenisation thinking beyond securities and settlement into commodities markets where the UK already holds a genuine structural advantage. For a publication tracking the UK's competitive position in tokenised markets, that pairing, on the same day, from the same regulators, is the more interesting story than either document read alone.
Key takeaways
The FCA's Call for Input on tokenised gold closes 23 October 2026 and could lead to a targeted exemption from UK fund rules, or a bespoke regime for tokenised gold developed with the Treasury and Bank of England.
The review covers tokenised products representing ownership of physical gold with transparent backing, defined ownership rights and reliable redemption.
No decision has been taken; any exemption is expected to be narrow and would not remove custody, market integrity or financial crime obligations.
The proposal is intended to help London compete for global bullion trading against other centres as tokenisation becomes more established in wholesale markets.
The Call for Input was published the same day as the FCA and Bank of England's broader Feedback Statement on tokenisation in wholesale markets, suggesting a coordinated push across asset classes.
Sources
Frequently asked questions
What is the FCA Call for Input on tokenised gold about?
The FCA is asking whether some tokenised gold products should sit outside the UK's fund rules altogether. It published the Call for Input on 14 September 2026, working with the Treasury and the Bank of England, and it closes on 23 October 2026.
What is tokenised gold?
Tokenised gold consists of digital tokens that confer ownership rights in physical bullion held by an issuer or custodian. The metal stays in a vault, while the tokens representing ownership can be transferred electronically.
Will tokenised gold be exempt from UK fund rules?
No decision has been taken. Options include a targeted exemption from the collective investment scheme and alternative investment fund regimes, or a bespoke regime developed with the Treasury and the Bank of England. Any exemption is expected to be narrow and would not remove custody, market integrity or financial crime requirements.
Why is the FCA looking at tokenised gold now?
Jon Relleen, the FCA's director of infrastructure and exchanges, has said tokenised gold emerged as a point of interest in conversations with market participants. Supporters argue tokenisation could make it simpler to divide, move and pledge bullion as collateral, helping London stay at the centre of global gold trading.
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