GOLD may soon become as easy to use as money in a digital wallet, as younger investors embrace technology and financial markets reshape one of the world’s oldest safe-haven assets.
That is the vision of David Tait, chief executive officer of the World Gold Council (WGC), who believes digital innovation will change not only how people invest in gold, but also how the precious metal functions within the global financial system.
He has made the remarks during an international gold conference held recently in Lanzhou, in the Gansu province.
Gansu, home to China’s second-largest gold reserves, generated about 180 billion yuan (US$26.6bil) in industrial output in its gold sector last year.
The province is seeking to move beyond resource extraction toward higher-value development.
“We will leverage this conference as an opportunity to deepen the integration of resource advantages, enterprise strengths and market vitality, and accelerate the high-end, intelligent, green and secure development of the gold industry,” governor Ren Zhenhe says.
Major transformation
Beyond advancing the industry’s high-quality development, Tait believes the next major transformation will come from the market itself.
“The biggest transformation is not only where gold is mined, but how it is owned, traded and used,” he says. “The most important thing will be the ability to use a digital form of gold in everybody’s wallet.”
He believes digitalisation will make gold easier to buy, trade and use as collateral, allowing a broader range of institutional investors, including pension funds, insurers and asset managers, to incorporate gold into diversified portfolios.
In order to support that transition, the WGC is advancing its Gold247 initiative, which aims to connect the physical gold market with digital financial infrastructure.
The initiative includes a global database for responsibly sourced gold and a “gold-as-a-service” platform designed to simplify the launch and adoption of digital gold products.
Tait expects younger investors to become one of the biggest drivers of that transformation.
As wealth is passed from older to younger generations, he says, tech-savvy consumers are increasingly comfortable managing investments through smartphones rather than buying traditional gold bars or jewellery.
“They just click and buy. That’s the future,” he adds.
Although physical bars and coins will remain an important part of the market, trusted digital products backed by physical gold are likely to become increasingly attractive because they are easier to access, trade and integrate into broader investment portfolios.
Shaping the global market
Tait also believes China is well positioned to play a larger role in shaping the global gold market.
He describes the Shanghai Gold Exchange as a model with international relevance and says closer coordination between Shanghai and the Hong Kong Special Administrative Region may strengthen global gold trading and custody services while supporting the internationalisation of China’s gold market.
That vision is echoed throughout the conference. Industry leaders calls for closer cooperation in mineral exploration, technological innovation, green development and financial services, while expanding Belt and Road partnerships to build a more resilient, sustainable and internationally connected gold industry.
As the industry enters the digital era, Tait believes China’s growing influence, from market infrastructure to responsible sourcing, will help shape the next phase of global gold development.
In a separate development, the People’s Bank of China (PBoC) was shown to have extended its gold-buying streak to 20 months in June, recording its largest monthly increase in the current accumulation cycle as bullion prices retreated from earlier highs.
Data reveal that China’s central bank added 480,000 ounces to the country’s official gold reserves in June to hit 75.44 million ounces.
The increase has come as gold prices fell further during the month after hitting a record high early this year.
The latest addition marks the biggest monthly increase since the central bank resumed gold purchases in November 2024, according to market tracker Wind Info.
Shao Yu, chief economist at the innovation centre of Fudan University’s School of Management, says that the PBoC acts more like a long-term allocator than a short-term trader – slowing purchases when prices rise significantly, while stepping up buying during precipitous declines.
Shao says that the PBoC is likely to continue its “small
but steady” approach to increasing gold holdings, reflecting both strategic positioning and efforts to optimise costs over time.
The PBoC may not be the single central bank buying gold on dips.
Ray Jia, head of research for Asia-Pacific excluding India at the World Gold Council, says that a recent survey by the council found a record share of central banks expect to keep increasing gold reserves over the next 12 months, citing a volatile international landscape and other risks as key drivers.
Meanwhile, the State Administration of Foreign Exchange reports that China’s foreign exchange reserves declined by US$26bil, or 0.75%, to US$3.4163 trillion end-June amid a stronger US dollar and a mixed performance of global asset prices, ending two straight months of increase.
The administration adds that the country’s steady economic progress provides solid support for reserve stability. — China Daily/ANN
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