Digital gold players seek Sebi oversight to boost trust, address regulatory vacuum
Digital gold providers have approached the India Bullion & Jewellers Association (IBJA), which has in turn written to Sebi asking that such platforms be brought under Sebi or another formal regulator to address concerns that customers may be misled or duped. The move follows Sebi’s recent warning that digital gold is neither a security nor a regulated commodity derivative, and therefore does not enjoy the investor protections available to products like gold ETFs, electronic gold receipts, or exchange-traded gold derivatives.
IBJA’s letter dated November 11 argues that regulation would help reassure consumers, noting that many digital gold offerings are backed by refiners approved by the Bureau of Indian Standards (BIS) and NABL-accredited labs. Industry players such as SafeGold highlight the need for a government-led surveillance framework to ensure that gold purchased via platforms is actually held in vaults and can only be liquidated by the rightful customer.
Digital gold has rapidly gained traction among younger investors because of instant liquidity, small-ticket access, and no locker costs, with transaction spikes during festivals like Dhanteras—SafeGold alone reported volumes rising from ₹800 crore last year to ₹1,950 crore this year. Until a clear regulatory framework is established, however, investors in digital gold remain outside Sebi’s formal protection regime, unlike those using listed gold instruments.