Singapore is reshaping the global gold market: Asia gains its own clearing system
The global gold market map is undergoing fundamental changes. Singapore is officially launching a large-scale program to become the main Asian hub for trading physical precious metals. On Monday, June 15, Deputy Prime Minister Gan Kim Yong presented an ambitious package of initiatives from the Singapore Exchange and the Monetary Authority of Singapore (MAS).
The key element is the creation of an over-the-counter (OTC) clearing system for physical gold stored on the island. The infrastructure launch is scheduled for the end of 2026, with interbank trading starting in 2027. Six of the world's largest banks have already become project participants: DBS, Deutsche Bank, ICBC Standard Bank, JPMorgan, OCBC, and UOB. This is a serious bid for leadership.
Asia dictates demand, but not prices
Statistics are relentless: Asia accounts for about 70% of global annual gold demand. However, the paradox is that key price benchmarks are still set in London and New York. This creates a systemic problem: during Asian trading hours, liquidity drops noticeably, making it difficult to conduct large institutional deals.
Singapore intends to eliminate this imbalance. The authorities do not aim to completely displace existing markets but want to become a connecting link — a hub that connects Asian demand with global liquidity during daytime hours. According to the World Gold Council, OTC deals are better suited for large institutional operations: they give participants more flexibility in terms of timing and conditions.
Additionally, from October 2026, MAS will begin offering gold storage services for foreign central banks and sovereign funds. As part of tax incentives, the 5% limit on investments in physical precious metals for funds and family offices is being lifted. This opens the floodgates for a significant influx of capital.
Race with Hong Kong and tokenization
Singapore has an active competitor. Hong Kong plans to launch its own gold clearing system as early as July this year and resume trading in metal futures. However, Singapore has the support of six heavyweight global banks, which is a powerful commercial argument.
Notably, one of the participants in the Singapore system, DBS, is preparing to issue tokenized physical gold for retail clients. Competitor OCBC is already actively buying, selling, and storing precious metals for institutions.
My view: Singapore is not just catching up with London — it is creating a new reality for the Asian market. The combination of physical infrastructure, tax incentives, and support from the largest banks could radically change the structure of gold pricing. If the project succeeds, we will witness a gradual shift of the center of gravity of the global precious metals market to the East. This is a serious challenge for London, which has been the undisputed benchmark for decades.