UK FCA Considers Exempting Rules to Drive Tokenized Gold & Commodities Adoption

UK FCA is preparing possible reforms for tokenized gold products on Monday, potentially exempting tokenized gold from UK fund rules. This would boost adoption by opening London’s bullion reserves up as usable collateral in financial markets.

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UK FCA Weighs Easing Rules for Tokenized Gold and Commodities

The Financial Conduct Authority is considering exempting tokenized gold, possibly broader tokenized commodities, from collective investment scheme (CIS) and alternative investment fund (AIF) rules, FT reported on September 14.

This comes amid a move to boost tokenized products by investors across the UK. The regulator is working with HM Treasury and the Bank of England (BoE) on the potential changes, with the latest update expected on September 14.

The UK dominates the global gold market with about 70% of trading volumes, as per the World Gold Council. However, it is now facing competition from China and has turned to tokenized gold to strengthen London’s dominant position as a center for bullion trading and custody.

Notably, tokenization could make traditionally physical and operationally complex assets such as gold easier to divide and transfer across digital markets. This also significantly reduces risks associated with physical gold.

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Growing Tokenization Products Adoption

The tokenized gold push coincides with the UK FCA’s cryptoasset authorization window opening on September 30. Crypto exchanges, custodians, brokers and other firms will regulate under the FSMA Cryptoassets Regulations 2026, with the full regime set for October 2027.

On the payments side, the Bank of England has published draft rules for stablecoins, including a temporary issuance guardrail and path for regulated sterling stablecoins from 2027. Revolut has already announced EURR euro stablecoin under EU MiCA rules, while a sterling-pegged stablecoin is still awaiting the UK framework.

Robinhood launched UK crypto trading with more than 50 assets via Bitstamp, London Stock Exchange Group partnered with Kraken parent Payward to tokenize the 100 largest London-listed companies as xStocks.

Moreover, Kraken expanded access to US stock trading for eligible customers across the European Economic Area (EEA), building on its existing tokenized xStocks offering.

For investors looking to gain on-chain exposure to precious metals, finding the right platform to trade tokenized gold is essential to ensure liquid trading and secure custody.