Golden numbers have arrived. Is London's $930 billion gold market about to change?

The ancient gold is now embracing a profound digital transformation. The World Gold Council, the representative organization of the global gold industry, officially proposed a groundbreaking initiative this Wednesday to launch a digital token backed by physical gold in London, aiming to completely change the way gold is traded, settled, and used as collateral. This move may inject new vitality into the world's largest physical gold trading center with a market size of up to $930 billion, but it has also sparked discussions in the market about the intense collision between tradition and innovation. Unlocking "dormant" assets, targeting the trillion-dollar collateral market For a long time, gold has mainly played a static, non-yielding value storage role on the balance sheets of banks and investors. According to David Tait, CEO of the World Gold Council, gold must be digitized in order to expand its market coverage. The core of this launch is a digital token called "Pooled Gold Interest (PGI)". According to Mike Oswin, Global Market Structure and Innovation Manager at the World Gold Council, each PGI token will represent the legal ownership of specific physical gold in the London vault and will allow investors for the first time to trade fractional ownership of standard 400-ounce gold bars. "We aim to position gold as a financial asset on par with digitally-native bonds or cash," Oswin clearly stated in an interview, "Through PGI, pledging gold will become as simple as pledging bonds." The core goal of this initiative is to activate the liquidity of gold as a financial collateral, making it easy to use to meet margin requirements and enter the vast global collateral market. "The Third Pillar": Reshaping London's trading landscape? Currently, the London over-the-counter gold market (Loco London) mainly consists of two trading modes: "Allocated Gold", which owns specific gold bars, and "Unallocated Gold", which has a claim to a certain quantity of gold and is the most common form of global trading, but investors bear the credit risk of institutions. The introduction of PGI is seen by the World Gold Council as the "third pillar" of market trading. According to data from the World Gold Council as of June 30 this year, the total amount of gold stored in the London vault was 8,776 tons, valued at $927.5 billion. Oswin optimistically stated that PGI even has the potential to serve as a physical settlement mechanism for gold futures contracts in the future, and its ambiti...