Sebi to not regulate digital gold: Tuhin Kanta Pandey
After cautioning the public against investing in digital gold, Sebi Chairman Tuhin Kanta Pandey has clarified that it has no plans to regulate it as it doesn’t fall under its purview.
In a statement on the sidelines of the National Conclave on REITs & InvITs 2025 in New Delhi, Pandey said Sebi’s gold regulations have already been explained through a press release. Gold investment can be done either through ETFs (Exchange Traded Funds), which mutual funds offer, or through tradable gold securities. “These are the products included in the regulated industry. So for now, we are focused only on these products,” Pandey said on the sidelines of the event. The Sebi chief added that digital gold doesn’t fall under its purview as it’s not a security.
In a press release dated November 8, the capital markets regulator said it has noted that several digital and online platforms are offering investors the option to invest in “Digital Gold” or “E-Gold” products, often positioning them as an alternative to physical gold.
It is important to clarify that these digital gold products are not the same as Sebi-regulated gold products. They are neither notified as securities nor regulated as commodity derivatives, and therefore operate entirely outside Sebi’s regulatory framework.
It said that investors should be aware that such products may carry significant risks, including counterparty and operational risks. Further, none of the investor protection mechanisms available under the securities market framework apply to investments in Digital Gold or E-Gold products. Sebi advises investors to exercise caution while considering such offerings, it added.
The absence of regulatory oversight means investors may not have strong safeguards around redemption, conversion to physical gold, assurance of vaulting, or transparency regarding the underlying gold backing these products. The Sebi release mainly serves as a reminder for customers to verify where and how their gold is stored, ensuring their investments remain secure and traceable.Also read: Quiet listing, loud returns: Ather’s multibagger post-IPO rally brings windfall gains for promoters as returns swell to 3,220%In a separate development, Tuhin Kanta Pandey also said that Sebi is looking at the inclusion of REITs in indices in a calibrated manner, signalling a fresh push to broaden participation and deepen India’s relatively young REIT and InvIT ecosystem. He added that the market regulator will further expand the pool of liquid mutual funds to include REITs and InvITs, underscoring the regulator’s intent to improve market access and liquidity.
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