Gold and Bitcoin are, in many ways, polar opposites: gold has an age-old reputation as a secure safe haven, Bitcoin is notoriously volatile; gold is a tangible asset, Bitcoin exists only in the digital realm; demand for gold is diverse, demand for Bitcoin is largely limited to speculation.

Yet, as investments, they also share some similarities: no link to the fiat currency system, scarce supply, and relatively simple authentication. 

It's why Bitcoin is sometimes referred to as ‘digital gold'. 

However, in the evolving global financial landscape, the World Gold Council has devised a plan to create a new type of ‘digital gold', and it is … well, digital gold.

Earlier this month, the WGC — working with multinational law firm Linklaters — published a white paper outlining its plan to create Pooled Gold Interests, or PGI, as a new pillar of over-the-counter gold trading.

While there are parallels to the crypto world, the proposed WGC system will be fundamentally different in that it will be entirely backed by real, physical gold stored in a vault.

It's not like launching a new meme coin or minting an NFT on a blockchain; rather, it's an alternative method of trading existing gold.

MNN sat down with WGC chief strategy officer Terry Heymann at Mining Forum Americas 2025 in Colorado Springs this week to understand the new world of digital gold. 

The current landscape

Before getting into PGI or digital gold, it's important to understand the two current methods of over-the-counter gold trading at an institutional or wholesale level: allocated gold and unallocated gold. 

Buying allocated gold gives an investor actual ownership of a specific bar stored in a bank vault. The gold is assigned to the buyer, who is given full legal ownership rights over the metal. 

This achieves two things: first, it means if the bank faces credit issues or insolvency, it has no right to sell the allocated gold — if you bought it, the bank can't touch it. It's a "bankruptcy-remote" asset.

Second, it means the allocated gold, being a secure asset, can be used as financial collateral. 

Unallocated gold, on the other hand, means that the bullion is not ‘set aside' for the holder but rather issued as a credit with the bank. 

The benefits here are that the gold can be "fractionalised"; instead of having to buy gold in, say, standard 400-ounce bars, investors can buy fractions of ounces at a time.

This makes it far easier to trade, with greater liquidity and deeper markets than allocated gold. 

Heymann said both systems had historically worked well and would continue to do so, but each had its drawbacks. 

Allocated gold can be difficult to trade given the need to physically move the gold from one vault to another, so settlement can be slow and operations complex. 

Further, while it can be used as collateral, this is sometimes difficult. If a 400oz bar costs US$1.4 million to buy, a holder can only collateralise in $1.4 million increments — you can't split a gold bar into halves or quarters.

Unallocated gold, meanwhile, is not bankruptcy-remote, because holders do not have a claim on the physical gold.

For this reason, unallocated gold can't be used as collateral.

Heymann said the idea behind digitalising gold was to combine the best of both allocated and unallocated metal and minimise their downsides. 

"What we've looked to do is combine the benefit of bankruptcy-remote gold ownership with fractionalisation and the ability to hold however much gold you want," he told MNN. 

New system, old gold

Heymann explained that under the WGC's proposed system, banks would put a certain amount of gold into a new vault, then issue Pooled Gold Interests based on the weight of the physical gold held, which will act as the beneficial interests in the gold.

For example, a bank would put 4000oz of gold into a vault, then record the serial numbers of each gold bar into a new digital ecosystem to create the PGI.

Investors can then buy these PGI by the thousandth of an ounce — there's no need to buy entire bars at a time. 

Protected by blockchain, distributed ledger technology or other traditional technologies, and backed completely by existing physical gold, the PGI are secure assets owned by the investor. 

"It relies on a new legal structure, a new trust vehicle, where those banks that own the gold put it into this Pooled Gold Interest, and you as an investor will have a certain amount of that Pooled Gold Interest," Heymann said. 

"Ultimately, in the event of a bankruptcy, you get that amount of gold that you are owed."

Essentially, the system is designed to enable investors to own the physical gold, like allocated gold, but in fractions of gold bars that can be easily traded, like unallocated gold. 

And, importantly, under this PGI system, the gold can be used as collateral. 

New demand drivers

If the PGI plan opens up more avenues for institutional trading, the subsequent increase in demand could spur already-surging gold prices higher — meaning miners stand to be indirect beneficiaries of the new system.

As if the gold market needed any more tailwinds, Heymann said the digitalised gold system would likely drive higher gold prices as PGI trading attracted a wider range of investors to the space.

"We see more wholesale institutions coming in, creating a more competitive marketplace and creating additional liquidity — those are always good things for demand," he said. 

"Also, the addition of new entrants means more product innovation. You could use PGI to start creating new digitally accessible gold products — whether that might be gold stablecoins or tokens.

"This sets a platform that allows innovation to happen because you have physically backed, bankruptcy-remote, fractionalised gold."

Of course, several factors drive gold demand and prices, but Heymann said PGI could naturally support the broader market as it reduced settlement friction, improved collateral use, and lowered capital costs for banks.

PGI to be put to the test

In theory, the WGC's vision for a new gold trading system in an increasingly digital world could reshape the market's foundations. 

How it works in practice will be put to the test soon. 

Heymann said the WGC planned to launch a pilot program for PGI in the UK within the next month or so. 

If that goes well, he anticipates the regulatory changes required to launch the digitalised gold system could be in effect as early as mid-2026.

"Because it's new, it has a legal structure that basically needs UK legislation to evolve to incorporate this," Heymann said. 

"We've had very positive initial conversations with the UK treasury and other regulators, but there will need to be some development in the underlying legislation to adopt this trust structure.

"We're very confident that it will work, but it's new, and it needs to be tested."