Digital Gold May Face Tighter Rules
The government is considering physical bullion backing and joint RBI-SEBI oversight for India’s estimated $3 billion digital gold industry.
India is considering tighter regulation of digital gold, including a requirement that every digital unit be backed by physical bullion, as the government reviews oversight of the growing segment.
The Finance Ministry has sought views from regulators, banks and other stakeholders on a possible framework. Discussions include bringing digital gold under the joint oversight of the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (SEBI).
The discussions also include potentially recognising digital gold as a security under the Securities Contracts (Regulation) Act, 1956. Industry estimates cited in the reports put the assets managed by the sector at around $3 billion, with the average transaction size at about ₹100.
SEBI had warned investors in November 2025 that digital gold and e-gold products offered through online platforms were outside its regulatory framework because they were neither notified as securities nor regulated as commodity derivatives. The regulator also highlighted counterparty and operational risks and said its investor-protection mechanisms would not apply to such products.
Under the proposed framework, physical bullion backing for digital gold could provide a formal link between units held digitally and the underlying gold. The government is still considering the regulatory approach, and the measures discussed have not been presented as final rules.
The industry has also been working on self-regulation. Digital gold platforms and bullion providers formed the Digital Precious Metals Assurance Council of India this year, with members including MMTC-PAMP, SafeGold, PhonePe, BharatPe, MobiKwik, Gullak, Lenden Club and CRED. The council aims to standardise processes related to the purchase, sale and storage of precious metals.