SEBI Warns Investors Against Unregulated ‘Digital Gold’ Products

PR No.70/2025, Dated: 08.11.2025

1. Background

SEBI has observed that several digital platforms, apps, and fintech intermediaries are offering investment products described as ‘Digital Gold’ or ‘E-Gold’. These products are marketed as an alternative to physical gold or gold-backed securities, often featuring online purchase, storage, and resale options.

2. Regulatory Position

SEBI has clarified that:

• Digital Gold/E-Gold is not recognised as a security under the SEBI Act or related regulations.
• These products are also not classified as commodity derivatives under SEBI’s regulatory framework.
• As a result, such offerings operate entirely outside SEBI’s regulatory supervision.

This means that entities selling these products are not subject to SEBI’s compliance, disclosure, auditing, or investor protection standards.

3. Investor Risks

Investors choosing such products may be exposed to significant risks, including:

• Counterparty risk – No regulatory safeguard if the seller defaults or shuts down,
• Operational risk – Issues relating to purity, storage, insurance, delivery or platform credibility,
• Absence of grievance redressal – SEBI-mandated dispute resolution and compensation mechanisms do not apply.

4. Distinction from SEBI-Regulated Gold Products

Investor protection measures applicable to regulated instruments such as:

• Gold Exchange Traded Funds (Gold ETFs),
• Gold Exchange products, and
• Commodity derivatives on recognised exchanges

do not extend to unregulated digital gold offerings sold through online platforms.

5. Advisory to Investors

SEBI has urged investors to:

• Exercise caution while investing in such unregulated products,
• Verify whether a gold-related product is SEBI-regulated, and
• Prefer authorised intermediaries and recognised exchanges for gold investment.

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