Singapore challenges London and New York: Asia gets its own gold clearing
Singapore is launching a large-scale program aimed at transforming itself into Asia's leading gold trading hub. The idea has been backed by six of the world's largest banks, which have joined the creation of a new clearing system for physical gold stored on the island. This is a direct challenge not only to Hong Kong but also to the established infrastructure of London and New York.
Asia Pays, but Does Not Control
The key factor driving Singapore to action is a colossal imbalance. Asia accounts for about 70% of global gold demand, yet pricing and the main liquidity flows remain concentrated in London and New York. This creates a systemic problem: liquidity drops during Asian trading hours, making large institutional deals difficult to execute.
On June 15, Deputy Prime Minister Gan Kim Yong presented a package of initiatives from the Singapore Exchange (SGX) and the Monetary Authority of Singapore (MAS). By the end of 2026, SGX will launch an over-the-counter (OTC) clearing system for physical gold stored in Singapore. Participants include DBS, Deutsche Bank, ICBC Standard Bank, JPMorgan, OCBC, and UOB. Interbank trading is expected to begin in 2027.
Infrastructure and Tax Incentives
In parallel, from October, MAS will provide gold storage services for foreign central banks, sovereign wealth funds, and international financial organizations. This will allow them to hold reserves directly in Singapore. Additionally, as part of tax incentives, the 5% limit on investments in physical precious metals for funds and family offices will be removed. They will now be able to significantly increase the share of gold in their portfolios without administrative barriers.
Race of Two Hubs
Singapore has an active competitor. Hong Kong plans to launch its own gold clearing system and resume trading in metal futures as early as July. However, the Singapore system has already secured support from six global banks, which is a serious bid for commercial success.
Notably, one of the participants, DBS, is preparing to issue tokenized physical gold for retail clients, while OCBC is already actively buying, selling, and storing precious metals for institutional investors in Singapore.
Cryptalist Analysis: The outcome of the race between Singapore and Hong Kong will be determined not by the speed of launch, but by the ability to attract real capital flows. Singapore is betting on institutional infrastructure and central bank support — this is a fundamentally more reliable path than relying on retail and speculative volumes. If MAS succeeds in establishing itself as a regional gold hub, it will reshape the global precious metals liquidity map for decades.