The global market for digital gold is currently estimated at $45 billion to $55 billion. Over the next five years, it could more than triple. That is the conclusion of the new study "Digital Gold: Unlocking a US$700bn Opportunity" by the World Gold Council (WGC) and Boston Consulting Group (BCG).

In the base case, the authors expect annual growth of around 27 percent. That would push the market volume to $160 billion to $170 billion by 2031. If existing market barriers are removed more quickly, they even see $270 billion to $280 billion as possible.

The figure of $700 billion, by contrast, refers to the total potential demand that could be unlocked under favorable conditions. It is explicitly not to be understood as a forecast for the next few years.

Tokenized gold is growing especially fast

The digital gold market comprises two distinct segments: digitally stored gold, in which investors access physical gold holdings through electronic accounts, and tokenized gold, in which ownership or claim rights are represented through digital tokens.

Tokenization is currently developing particularly dynamically. Since the end of 2024, the market value of tokenized gold has quintupled, according to the study, and now stands at around $6 billion.

Well-known products include PAX Gold (PAXG) and Tether Gold. In these models, the physical precious metal remains in custody, while the corresponding tokens can be transferred and traded digitally.

Nine out of ten investors are fundamentally interested

The study authors see the greatest growth potential among retail investors. Almost nine out of ten respondents would consider investing in digital gold under suitable conditions.

Digitalization could also open up additional buyer groups. Around 65 percent of estimated latent demand comes from people who do not currently hold any gold at all.

Among current investors in digital gold, 52 percent had never invested in the precious metal before their first digital gold purchase. Of those, 92 percent later also bought other gold products.

The authors therefore assume that digital offerings will not merely replace existing investments, but could expand the entire gold market. Even after taking possible shifts between investment forms into account, they expect additional gold demand of around $95 billion in the base case by 2031.

Trust remains the biggest hurdle

Despite the considerable interest, obstacles remain. The study identifies four key factors: lack of trust, limited access, restricted use cases and costs.

For potential investors, transparent proof of the physical backing of the gold, effective investor protection and reliable ways to redeem digital claims are particularly important.

There is also still little standardization. Different providers use their own technical and legal structures, which makes it harder to transfer and exchange digital gold products.

The Asian market shows how strongly easy access can influence adoption, according to the study. In China, India and Indonesia, digital gold is in some cases available directly via banking apps, payment platforms and so-called super apps. There, the share of investors holding digital gold is up to seven times higher than in less developed markets.

World Gold Council plans shared infrastructure

To break down the existing barriers, the World Gold Council is working on a shared infrastructure for digital gold products. The concept "Gold as a Service," presented together with BCG in March 2026, is designed to connect the physical sourcing and custody of gold with digital systems for issuing and managing gold-backed products.

More standardized processes are planned for custody, control, regulatory requirements and redemption. This should make it easier for providers to launch new products without having to build all the technical and organizational structures themselves.

New revenue opportunities through gold lending

However, development is not limited to easier gold trading. New products are increasingly seeking to make the precious metal usable for additional financial transactions as well.

One example is the PAXGy token introduced at the end of September by Paxos Labs. It is built on the existing PAXG gold token and is intended to give investors access to the institutional gold lending market.

According to the provider, the underlying gold holdings are used via selected institutional borrowers. The resulting returns are intended to increase the value of the new token relative to PAXG over time.

Such models create additional uses, but they also bring risks. In addition to the gold price, the legal structure of the claims, custody and possible counterparty risks play a role.

Younger investors are driving the development

Interest in digital gold is particularly pronounced among younger people. In the 25 to 34 age group, half are already familiar with corresponding offerings, according to the study. Among those over 55, that share is only 23 percent.

For banks, asset managers and providers of digital investment products, this opens up new business opportunities. However, the prerequisite is that digital gold investments become not only easier to access, but also remain transparent in terms of backing, regulation and risks.

The key question, therefore, is less whether gold can be traded digitally - that is already possible. Rather, the issue is whether a trustworthy and broadly usable market can emerge from the currently fragmented offerings.