ICE Expands Precious Metals Futures in London Bullion Hub
Intercontinental Exchange (ICE) has launched new precious metals futures contracts in London this week, marking a significant expansion into the world’s leading physical bullion hub. The derivatives cover gold, silver, platinum, and palladium futures, all tied to ICE’s daily auction prices in the city. London plays a critical role in the global precious metals market, handling over-the-counter physical gold transactions worth over $190 billion daily and storing approximately $1.4 trillion in bullion reserves.
London’s history with gold futures has been turbulent, with past attempts like the London Metal Exchange’s gold futures contract closing in 2022 due to low trading volumes. However, recent geopolitical shifts, including trade tensions and economic sanctions, have reshaped the market. In April 2025, futures prices in New York rose above physical prices in London, prompting dealers to move large amounts of gold to America. Chris Rhodes, president of ICE Futures Europe, emphasized that derivatives markets support the physical market, stating, “The physical market is in London. We believe that if you were to enable people to manage their risk in a different way . . . that could be an attractive prospect, particularly if it’s linked into the auction price.”
Central banks are also adjusting their gold storage strategies amid growing geopolitical unrest. Last month, the Dutch central bank relocated over 78 tonnes of gold from New York to London. Meanwhile, Hong Kong and Singapore are expanding storage facilities, while France and India have repatriated gold reserves. Venezuela is working to transfer roughly $4 billion in disputed reserves from the Bank of England to New York. Gold reached a record high above $5,500 per troy ounce in January, with ICE’s U.S. gold futures contract averaging approximately $125 billion in daily volume during the first half of the year.
ICE’s London contracts will settle against its physical auction prices for all four metals, with durations ranging from same-day to six months. Clearing will be handled through ICE’s London division, which also operates Brent crude oil futures. Since acquiring the gold benchmark a decade ago, ICE’s auction has grown from four firms to 20 participants, including major players like Jane Street, DRW, Goldman Sachs, and Citi. Daily auction volumes have surged beyond 424,000 ounces, reflecting a 30% increase since 2015.