Digital gold is becoming a popular way to buy gold, especially during festivals like Dhanteras and Diwali. The World Gold Council predicts the digital gold market could grow to $170 billion by 2031. However, investors need to be aware of the risks involved, as highlighted by a warning from the Securities and Exchange Board of India (SEBI) in 2025.
- The digital gold market is expected to grow at about 27% annually, reaching $160–170 billion by 2031.
- Digital gold purchases in India rose 5% month-on-month in September 2026, with a value of ₹25.9 billion.
- SEBI warns that digital gold carries counterparty and operational risks and lacks certain investor protections.
- Digital gold differs from regulated products like gold ETFs, which are traded on stock exchanges and regulated by SEBI.
- Buyers should check platform credibility, storage methods, costs, and redemption policies before investing.
What Is Digital Gold and Why Is It Growing?
Digital gold allows consumers to buy small amounts of gold online without taking physical delivery immediately. This convenience and low minimum investment have made it popular, especially during festive seasons when gold buying increases.
The World Gold Council's report from October 2026 states the global digital gold market is currently valued at $45–55 billion and could grow rapidly to $170 billion by 2031. This growth is driven by easier access and increasing demand.
What Are SEBI's Concerns About Digital Gold?
In November 2025, SEBI issued a warning about digital gold products. It highlighted that these products might expose investors to risks related to the platform or service provider, such as counterparty and operational risks.
SEBI also clarified that digital gold does not fall under the same regulatory protections as gold exchange-traded funds (ETFs), electronic gold receipts (EGRs), or exchange-traded commodity derivatives. This means investors may not have the same safeguards if problems arise.
How Does Digital Gold Differ From Other Gold Investments?
Gold ETFs and other regulated gold products are traded on stock exchanges and regulated by SEBI. They offer different ownership structures, costs, liquidity, and investor protections compared to digital gold.
Digital gold is usually sold through online platforms that store the gold on behalf of buyers. However, the terms of ownership and redemption can vary widely between providers.
What Should Buyers Consider Before Purchasing Digital Gold?
Before investing in digital gold, buyers should carefully review the terms and conditions of the product. Important factors include:
- Who operates the platform and how trustworthy they are.
- How and where the gold is stored and verified.
- Contractual rights over the gold holdings.
- Minimum quantities required for physical delivery.
- Storage fees, transaction charges, and delivery costs.
- The difference between buying and selling prices.
- What happens if the platform faces financial or operational difficulties.
- Whether there is a clear process for selling holdings or redeeming physical gold.
What Does the Future Hold for Digital Gold?
The World Gold Council believes that overcoming challenges related to trust, access, and pricing could unlock up to $700 billion in long-term demand for digital gold. However, actual market growth will depend on how these issues are addressed.
While digital gold offers new ways to invest in gold, it is important for buyers to understand the risks and protections involved. Careful research and consideration can help investors make informed decisions during the festive gold-buying season and beyond.
