FCA Seeks Feedback on Tokenized Gold Classification

The UK Financial Conduct Authority (FCA) has launched a consultation on potential exemptions for fund rules covering tokenized gold products. The move aims to clarify regulatory expectations for tokenized gold, which could be used as collateral in wholesale arrangements.

According to the FCA, some tokenized gold products may fall within the UK's collective investment scheme (CIS) or alternative investment fund (AIF) perimeter, affecting market participation and investor confidence. The regulator warned that uncertainty around fund-rule scope could slow development of tokenized gold use cases.

The consultation, open until October 23, seeks feedback on how to address the classification issue. The FCA may consider clarifying existing rules, creating recognized regulatory classifications, or introducing targeted rule changes. A bespoke regime for tokenized gold or commodities is also possible if stakeholders indicate that current frameworks do not fit.