18th June 2026
By Anjali Kochhar
Singapore is accelerating its ambitions to become Asia’s premier gold trading hub, unveiling plans for a dedicated gold-clearing system backed by some of the world’s largest financial institutions. The initiative, led by the Monetary Authority of Singapore (MAS) and the Singapore Bullion Market Association (SBMA), aims to strengthen the city-state’s position in the global precious metals market and challenge Hong Kong’s dominance in the region.
MAS and SBMA Launch Gold Market Development Working Group With Major Banks
Announced on March 27, the project focuses on creating a comprehensive over-the-counter (OTC) gold settlement infrastructure capable of handling large gold bars and kilobars. The move is part of Singapore’s broader strategy to enhance market liquidity, improve settlement efficiency, and establish world-class standards for vaulting and logistics.
To drive the initiative forward, MAS and SBMA have formed the Gold Market Development Working Group, which includes major industry participants such as JPMorgan Chase Bank, UBS AG, DBS Bank, ICBC Standard Bank, United Overseas Bank (UOB), Singapore Exchange (SGX), and the World Gold Council. The group was established in January 2026 and has been tasked with developing the framework needed to support Singapore’s growing gold market.
The working group’s priorities for 2026 center on three key areas. First, it will build a dedicated clearing system for OTC gold transactions, enabling faster and more efficient settlement. Second, it will explore the development of capital-market products designed to increase trading activity and liquidity. Third, it will establish internationally recognized standards for gold storage, vaulting, and logistics operations.
2,000-Metric-Ton Vault Target and Singapore’s Race Against Hong Kong
A major component of Singapore’s strategy is expanding its physical gold storage capacity. The city-state has set an ambitious target of exceeding 2,000 metric tons of vault capacity within the next three years. While this is still below the approximately 5,000 tons reportedly held in the Bank of England’s vaults, it would represent a significant increase in Asia’s ability to store and settle physical gold transactions locally.
The initiative also highlights the growing competition between Singapore and Hong Kong. Hong Kong is currently developing its own Precious Metals Central Clearing Company, with pilot trials expected in 2026 and a full launch planned for July. Both financial centers are investing heavily in infrastructure as they compete to become the region’s primary hub for gold trading and settlement.
Asian Time Zone Settlement Benefits and Singapore’s Physical-Only Approach
For institutional investors, Singapore’s proposed clearing system could offer significant benefits. By enabling large gold transactions to be settled within Asia’s time zone, investors would no longer need to rely exclusively on London-based infrastructure. This could reduce settlement delays, lower counterparty risks, and streamline trading operations during Asian market hours.
Notably, Singapore’s plans focus entirely on physical gold infrastructure. Despite the increasing popularity of blockchain technology and tokenized assets, the roadmap contains no references to digital gold tokens, cryptocurrency-based settlement systems, or blockchain platforms. Instead, Singapore appears committed to building a robust, traditional precious metals ecosystem centered on physical storage, trading, and settlement capabilities.
