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India’s markets regulator, the Securities and Exchange Board of India (SEBI), has issued a strong warning to investors about the risks of investing in digital or e-gold schemes. The advisory follows SEBI’s findings that several online platforms are actively promoting these products as convenient substitutes for physical gold, even though they fall outside the regulator’s oversight. “In this context, it is informed that such digital gold products are different from SEBI-regulated gold products as they are neither notified as securities nor regulated as commodity derivatives. They operate entirely outside the purview of SEBI,” the regulator said in a statement. The market watchdog stressed that these offerings “may entail significant risks for investors and may expose investors to counterparty and operational risks.” Since they exist outside the regulatory fold, such schemes lack the safeguards and investor protection mechanisms applicable to recognised financial instruments. Regulator Urges Use Of Licensed Gold Investment Options SEBI reiterated that investors seeking exposure to gold should opt for instruments that fall within its regulatory framework to protect themselves from any kind of fraud. “All investments in SEBI-regulated gold products must be made through registered intermediaries and are governed by the regulatory framework prescribed by the regulator,” SEBI said. These regulated avenues include Gold Exchange Traded Funds (ETFs) offered by mutual funds, exchange-traded commodity derivatives, and Electronic Gold Receipts (EGRs), which are tradable on recognised stock exchanges. Such products ensure transparency, accountability, and investor protection, features missing from many unregulated online gold investment schemes. Investor Awareness And Market Integrity The advisory serves as a reminder for retail investors to be cautious of unregistered digital platforms promising quick or easy exposure to gold and related nvestments. SEBI’s warning aims to protect investors from falling prey to fraudulent or non-compliant entities, which may not guarantee the safety or redemption of their investments. Get Latest News live on Times Now along with Breaking News and Top Headlines from Business, Companies and around the world.
