Digital gold market could reach $170 billion by 2031, WGC and BCG say

The digital gold market is expected to grow to $160 billion to $170 billion by 2031, and new research suggests that the demand could be as high as $700 billion once there are no more obstacles to adoption.

In an October 19 report, the World Gold Council (WGC) and Boston Consulting Group (BCG) valued the digital gold market at $45–55 billion, which consists of tokenized gold and digital products secured by vaulted gold bullion. In its base case projections it projects growth of approximately 27% annually over the next five years.

However, the $700 billion figure represents a separate estimate of potential demand if existing barriers to adoption were removed. It is not a forecast of purchases by 2031, as the researchers clarify in their methodology.

Digital gold demand could exceed $270 billion in stronger scenario

The report models a faster-growth outcome in which digital gold reaches $270–280 billion by 2031. The higher estimate assumes that restrictions involving investor confidence, distribution, product usefulness and pricing are addressed more quickly.

Researchers examined more than 70 digital gold products and surveyed over 12,000 retail investors across 12 markets. They conducted interviews with 20 industry experts, including representatives of banks, exchanges, asset managers and gold infrastructure providers.

The market projections cover 96 countries representing 98% of global investable wealth. Their calculations combine the number of potential investors, average investable wealth, expected participation and portfolio allocations.

Importantly, the model holds gold prices constant. It excludes significant security breaches and major custody failures, which could discourage investors even if digital gold products become easier to access.

The World Gold Council estimates that the physical investment gold market is worth approximately $13 trillion. Its research places digital gold at less than 1% of that market today.

Tokenized gold trading surpassed $90 billion in three months

Blockchain-based gold products have already recorded considerable trading activity.

The report puts the value of tokenized gold at roughly $6 billion, around five times its level in late 2024. Tokenized gold is only one part of the digital gold category, which includes non-blockchain products representing vaulted bullion.

Spot trading volume exceeded $90 billion during the first quarter of 2026. Earlier CoinGecko market research placed the figure at $90.7 billion, compared with $84.6 billion for the entirety of 2025.

The figures describe cumulative trading activity, not the value of gold tokens outstanding. The same tokens can change hands repeatedly, so transaction volume should not be counted as new investment demand.

Tokenized gold is being used for activities beyond spot trading. In August, crypto.news documented rising gold-backed lending after Tether Gold-backed borrowing on Aave reached a $25 million debt ceiling earlier in the year.

The lending protocol subsequently raised borrowing capacity as demand continued, according to its risk manager, Chaos Labs. Separate lender Arch introduced loans backed by PAX Gold and Tether Gold, allowing eligible customers to borrow against tokenized bullion.

Trust and redemption remain barriers for gold investors

Nearly nine in ten investors surveyed by the World Gold Council and BCG said they would consider digital gold under suitable conditions. The research identifies trust as the leading requirement before many prospective customers would invest.

Respondents emphasized transparent evidence of physical backing, consumer protections, clearer regulation and the ability to redeem digital holdings for gold.

“Significant investor interest in digital gold is clear, but demand cannot scale without the right infrastructure behind it,” said David Tait, chief executive of the World Gold Council.

The organization is developing Gold as a Service, a shared infrastructure initiative intended to support issuance, custody, sourcing and compliance for digital gold products.

Access through existing financial applications appears to influence adoption. The report found that digital gold ownership was up to seven times higher in markets where products were distributed through familiar payment apps, banking services and similar platforms.

Researchers identified China, India and Indonesia as examples of markets where such distribution channels are established.

Their findings indicate that 65% of potential demand comes from people who do not already own gold. Among existing digital gold investors, 52% had held no gold before their first digital purchase.

Gold-backed tokens gain lending and yield applications

The industry’s interest in making gold usable as collateral or a yield-bearing asset is already producing new products.

In September, Paxos Labs introduced a gold-backed token called PAXGy, which accepts deposits of PAX Gold and seeks to generate returns through institutional gold leasing.

Paxos Labs says the token’s redemption value can grow in gold terms as leasing income accrues. Borrower defaults and losses could affect those returns, according to the project’s own disclosures.

An Aave risk assessment published in October examined the token’s proposed use within decentralized lending, including collateral limits, liquidity and withdrawal arrangements.

The World Gold Council’s research estimates that around $95 billion of the base-case market expansion by 2031 could represent genuinely new demand for gold. It places awareness of digital gold at 50% among investors aged 25–34, compared with 23% among people aged 55 and older.