SEBI’s Warnings Unheeded: Investors Snap Up Over 12 Tons of Digital Gold in 11 Months

Despite SEBI’s regulatory alerts, the demand for digital gold surged between January and November. Young investors primarily drove this trend. Over 12 tons of gold were purchased during this period.

Market Regulator Flags Digital Gold Risk

The market regulator SEBI had issued a stern warning regarding Digital Gold. They stated that Digital Gold products are not under SEBI’s regulation. The market regulator cautioned investors. They clearly said that Digital Gold is not regulated under commodity derivatives. They also emphasized that it is not a secure investment.

SEBI Clarifies Its Non-Liability

SEBI explained its position. They stated that if someone buys Digital Gold through an unregistered app, SEBI is not liable. This applies if the platform faces operational issues. It also covers situations where the company goes bankrupt. In such cases, investors’ money could get stuck. SEBI clearly states that this is not their responsibility.

Alert Issued Despite Promotion

SEBI issued an advisory on November 8, 2025. It stated that products sold as ‘Digital Gold’ or ‘E-Gold’ online are outside SEBI’s oversight. These products are promoted as an alternative to physical gold. Yet, they remain outside the regulator’s purview. Investors’ funds face risk from system failure or operational glitches. SEBI will bear no relation to such issues. However, the alert seems to have had little effect on the public.

Demand Crosses 12 Tons

Demand for Digital Gold saw a major jump from January to November this year. Young people especially invested heavily in it. World Gold Council (WGC) data shows a clear picture. Over 12 tons of gold were bought in just 11 months of the year.

WGC Data Based on UPI Transactions

WGC’s estimate relies on UPI transaction data from NPCI. This data tracked digital gold purchases. NPCI has released this data for the first time this year. The 12 tons of 24-carat gold are valued high. Spot prices in Mumbai on Wednesday placed the value at about $16,670 crore. Industry estimates show that Indians bought approximately 8 tons of equivalent Digital Gold in 2024.

Warning Failed to Deter Investors

Investors find Digital Gold an attractive choice despite SEBI’s caution. It allows small investments, starting from just ₹1. This makes it popular among first-time investors. It is also favored by young buyers using apps and fintech platforms. Some investors have become wary due to SEBI’s alert. Meanwhile, industry experts seek a clear regulatory framework for Digital Gold.