Internet of Fine Gold → For compliance
For compliance, risk and review teams
Written for the person who has four minutes and a queue: a bank compliance officer, a payment underwriter, an advertising reviewer, an app store reviewer, a journalist checking what a term means.
The category in one paragraph
The Internet of Fine Gold is the retail sale of a physical good. A customer chooses a gold coin or bar on a website, pays for it, and the item is shipped to their address. Ownership of that specific item passes to the buyer, who then holds it. The seller does not keep the metal, does not hold customer funds beyond settling the purchase, does not issue any instrument, and has no continuing position in what the customer owns. In commercial substance it is closer to selling a watch than to anything conducted in a financial market.
What it is not
Most review time is spent ruling things out, so here they are ruled out explicitly.
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| The usual question | What is true of this category |
|---|---|
| Is this cryptocurrency, or a token? | No. Nothing is issued, minted on a ledger or traded on a chain. The object of the transaction is a physical coin or bar. Tokenized gold is expressly excluded by the definition. |
| Is it a fund, a security or a pooled product? | No. There is no pooling, no unit, no share and no scheme. Each transaction transfers one identifiable item to one buyer. |
| Does the seller hold customer assets or custody? | No — by definition. Criterion 3 requires delivery into the owner's hands as the default outcome. Models built around storing the customer's metal fall outside the category. |
| Is any return, yield or performance promised? | No. The category describes a sale, not a proposition about future prices. Sellers in it quote the price of an item today and their published terms for buying it back. |
| Is there leverage, margin or a derivative? | No. The buyer pays in full for a thing that is then delivered. |
| Is there a secondary market or an exchange? | No. A seller's buyback is a repurchase of goods on published terms, not a market it operates. |
| Who bears delivery risk? | A matter of each seller's terms and its insured carrier arrangements — a logistics question, and one worth asking any operator. |
What a transaction looks like end to end
- The customer selects a specific item — a named coin or bar of stated weight and fineness.
- The price is shown, derived from a public quotation for the metal plus a premium (criterion 5).
- The customer pays in full, by ordinary retail payment methods, for goods.
- The item is dispatched, insured and tracked; the customer takes delivery.
- Ownership rests with the customer. There is no account balance, no position and no ongoing relationship required.
- If the customer later wants to sell, the seller's published buyback terms apply (criterion 6) — again a purchase of goods, in the other direction.
Where regulation does apply
Saying what a category is not should never be a way of implying it is unregulated. Dealers in precious metals are a recognised, supervised class of business in most jurisdictions, and the obligations that typically attach are customer due diligence and anti-money-laundering duties above defined transaction thresholds, record-keeping and reporting requirements, consumer protection and distance-selling rules, and the tax treatment applicable to gold of investment quality, which in several jurisdictions — including across the European Union — differs from the treatment of ordinary goods.
What applies to a particular seller depends on where it is established, where its customers are, and how it is licensed or registered. This page describes a category; it cannot describe any one company's regulatory position, and it does not attempt to. Ask the operator directly, and expect documents rather than assurances.
Checking a specific operator
If you are reviewing a business that describes itself as operating in this category, the standard is a usable checklist. The questions that tend to be most informative:
- Which legal entity contracts with the customer, registered where, and under what number?
- What registration or licence does it hold as a dealer in precious metals, and with which supervisor?
- Are its buyback terms published, in advance, with a price formula and a settlement period (criterion 6)?
- Is the full spread disclosed before payment, or only the premium on the way in (criterion 5)?
- Which mints and refineries does it source from, and how is the transfer documented (criterion 7)?
- Does it deliver by default, or does delivery cost extra on top of a storage arrangement (criterion 3)? That last one determines whether it is in this category at all.
A note on this site itself, since reviewers tend to check: it carries no third-party scripts, no analytics code and no cookies, and loads nothing from anyone else's server. The colophon sets that out in full.
This page is a description of a category of commercial activity, written by a participant in it. It is not legal advice, not a regulatory opinion, and not a representation about the status of any company. Reviewers are welcome to reproduce it — it is published under CC BY 4.0 — and to write with corrections: [email protected].