Hong Kong Aims to Launch New Gold Settlement System by July, Possibly Allowing "Bearer Gold Accounts"

According to media reports citing informed sources, Hong Kong is accelerating its plan to establish an international gold trading hub, targeting the launch of a new gold settlement system by July this year. The system, which will be government-owned, is modeled on the financial infrastructure of London, the world's largest gold market. It will allow participants to conduct trade settlements through "bearer gold accounts."

Sources revealed that "bearer gold accounts" enable faster and larger-scale transactions, which are crucial for market liquidity. Clients do not need to hold specific numbered gold bars; they only need to hold a claim on the quantity of gold with the settlement institution. Currently, most precious metal trades in the London market are settled in this manner.

To support the launch of the settlement system, Hong Kong has invited multiple central banks to participate, strengthening its position as a center for gold trading, financing, and storage. Authorities have previously signed a cooperation agreement with the Shanghai Gold Exchange and plan to expand gold storage capacity to 2,000 tonnes within three years.

The Hong Kong Financial Services and the Treasury Bureau, responsible for the project, stated in an email response that preparatory work "has entered the final stage, and a trial run of the settlement system is expected to commence within this year."

According to two sources, the settlement system has attracted significant interest from the industry, particularly from traders and financial institutions seeking alternative trading channels in Asia, home to the world's two largest gold consumers, China and India.

Last month, the Hong Kong government announced that the board of directors for the Hong Kong Clearing Company includes 11 banks, comprising five Chinese banks and six international banks, such as Industrial and Commercial Bank of China, Bank of China, HSBC Holdings, JPMorgan Chase, and UBS Group. Among them, HSBC, JPMorgan Chase, UBS, and ICBC Standard Bank are also co-owners and operators of the London settlement system.