Britain’s top financial regulators have put tokenized gold on the map, literally. In a joint vision paper published on May 18, the Financial Conduct Authority, the Bank of England, and the Prudential Regulation Authority outlined how tokenized gold could be used as collateral in over-the-counter derivatives trades. The goal: make traditional markets faster, cheaper, and more flexible by putting real-world assets on digital rails.
The paper doesn’t create a brand-new regulatory category for tokenized gold. Instead, it folds tokenized assets into the existing framework under UK EMIR, the post-financial-crisis rules governing derivatives clearing and collateral. Under this approach, a bar of gold and its tokenized twin get the same regulatory treatment. No special privileges, no extra hurdles.
Same asset, different wrapper
The PRA made the principle explicit in a Dear CEO letter accompanying the vision paper. Tokenized traditional assets should receive the same prudential treatment as their non-tokenized counterparts, regardless of the underlying technology or blockchain used.
Under UK EMIR, there is no distinction between tokenized and conventional instruments for collateral eligibility. That means a tokenized gold position could, in theory, satisfy margin requirements for uncleared OTC derivatives trades, the same way physical gold or government bonds do today.
