Is your digital gold really safe

SEBI has warned that “digital gold” or “e-gold” sold by various online platforms is outside its regulatory purview and is neither a security nor a regulated commodity derivative, so investor protections do not apply to these products and they carry counterparty and operational risks for buyers. SEBI enables regulated gold exposure through Gold ETFs by mutual funds, exchange-traded commodity derivatives, and Electronic Gold Receipts on stock exchanges via SEBI-registered intermediaries, so investors should choose these routes for better oversight and recourse.

SEBI’s advisory separates app-based “digital gold” from regulated market products and warns that vaulting, ownership, and redemption rely on private contracts outside securities safeguards, so platform disputes or distress can leave investors exposed. News reports echo the same point and note the advisory does not brand all platforms as fraudulent, but it flags the gap in supervision and the absence of SEBI’s investor protection mechanisms for such offerings.

Use this simple checklist: confirm the product is a SEBI-regulated instrument such as a Gold ETF or an EGR, and transact only through SEBI-registered intermediaries. Avoid unregulated “digital gold” sold as a substitute for physical gold, and remember that recourse, grievance redress, and surveillance apply to regulated products, not to platform schemes.If you want digital ease with regulation, choose Gold ETFs through your broker or EGRs on stock exchanges. Both fall under SEBI’s framework and provide market-wide protections and transparency. So you get online convenience and a clear safety net, and you reduce the counterparty and operational risks common in unregulated offerings.