Law, risk and the digital gold dilemma

For most Indian households, gold is not just a metal; it is security, sentiment and social status rolled into one.

- B.N.S. SRIRAM & P.S. MUSTAQ

Gold has served as a store of value across caste, religion, gender and region.In that cultural context, the idea that the same gold can now be “bought” with a single tap for as little as one rupee on a mobile app sound both magical and irresistibly modern. This is the promise of “Digital Gold” or “EGold” as marketed on popular platforms and several jeweller-backed apps. A user can log in, buy gold of any denomination such as 1 rupee, 10 rupees, 100 rupees or more and is assured that an equivalent quantity of physical gold is safely stored in a vault somewhere on their behalf. Daily “micro-investing” in gold, without ever visiting a jewellery shop, is marketed as the new normal. However, on 8" November 2025, the Securities and Exchange Board of India (SEBI) punctured this rosy narrative. Through Press Release No. 70/2025, SEBI issued a formal caution to the public, warning that so-called “Digital Gold/EGold” offered on online platforms is neither notified as a security nor regulated as a commodity derivative, and that no investor protection mechanism under securities law applies to these products.

WHAT EXACTLY IS DIGITAL GOLD?