There is one element that has caught our attention in recent days, as well as that of gold negotiators globally. China’s undeclared gold purchases could be more than 10 times higher than official figures, as China quietly seeks to diversify its investment away from the US dollar, shining a spotlight on the increasingly opaque sources of demand behind the exponential growth in the value of bullion.
Unlike oil, which can be tracked by satellite and where OPEC plays a role in regulating production, this traceability is not possible with gold. There is no way of knowing where it ends up and who buys it: we can only record how much gold leaves official smelters. This is precisely why China covers its purchases through the People’s Bank of China, following its official gold purchase programme, managed by the State Administration of Foreign Exchange (SAFE), according to which it has officially purchased only 25 tonnes this year (see Figure 1).
Figure 1. Official data on gold purchases in 2025 aggregated by country.
Added to this are purchases by the Chinese sovereign wealth fund and the army. Gold reserves are usually stored in Shanghai or Beijing, but obviously these deposits are not accessible for inspection and accounting purposes (after all, even the President of the United States has stated that he does not know how much gold is stored in the Fort Knox Bullion Depository).
In a world where even the International Monetary Fund collects data on a voluntary basis, we must rely on alternative databases (such as Metals Focus research) or proxy variables such as orders for freshly minted 400-ounce bars with consecutive serial numbers, which are typically refined in Switzerland or South Africa and shipped via London to China, or the gap between China’s net imports (and domestic gold production, which accounts for about 10% of global production) and the change in the amount held by commercial banks or purchased by retail consumers (based on the assumption that the latter are suppliers).
There are valid reasons for this opacity. The two main ones are:
1) Fear of retaliation by the US administration, because central banks are buying gold to escape the dollar;
2) Selling at good prices when it comes to disposing of part of their reserves. If the data on the largest gold holders were fully tracked and public, any sale by the big “treasuries” would immediately trigger herd selling, causing problems for large dealers.
It is these two reasons that have made all central banks more secretive about their inventories (see Figure 2).
Figure 2. Gold purchases by official central banks and estimates of undeclared purchases.
In addition, China is quietly proposing itself as a global depository for other countries’ gold, courting developing countries to deposit it in the country: a role currently played by the United States (which has recently been subject to several repatriation requests, see our Insight of 4 July 2025). Cambodia, for example, recently agreed to deposit its newly purchased gold, paid for in renminbi, in the vault of the Shanghai Gold Exchange in Shenzhen.
So far, we have talked about bullion and therefore investment gold traded by large operators. However, there is another type of gold, which clearly presents other types of pitfalls (counterfeiting, but here too there is something new, as we will see shortly) but which offers very interesting investment prospects, if only for its intrinsic numismatic value: we are, of course, talking about coins.
A few days ago, it was announced that the Royal Mint is reintroducing traditional sovereign coins in yellow gold, a move that could spark enthusiasm among collectors, historians and investors. After decades dominated by the rose gold version, the 2026 sovereign collection marks a spectacular return to the classic golden hue that has characterised the coin for centuries. The return to yellow gold has historical significance. The sovereign has been part of British monetary identity for over 500 years. First introduced in 1489 under King Henry VII, it symbolised authority and national stability. The modern sovereign, recognised throughout the world today, made its debut in 1817. It became the most important gold coin of the 19th century, circulating throughout the expanding British Empire and becoming a reliable currency for international trade, synonymous with security, reliability and prestige.
And this return to yellow gold is only part of what will make 2026 one of the most important years in the sovereign’s more than 100-year history. The Mint says it is not just reviving tradition, but rewriting the rules of security for the coins it produces. In a world increasingly flooded with fakes, imitations and sophisticated counterfeits, collectors and investors were clamouring for greater reassurance.
Now they finally have it. The 2026 gold sovereign, produced in unlimited quantities to ensure its accessibility to the widest investment market, features three state-of-the-art security features borrowed from the powerful Britannia coin: micro-text, a latent security image and secure background patterns. These innovations make the new sovereign one of the most visually secure gold coins ever minted.
The commemorative sovereigns, limited to just 3,000 pieces and carefully minted at a rate of only 50 coins per hour, remain true to tradition, craftsmanship and collectability. They have the classic golden yellow sheen that collectors have been begging the Mint to restore, and their scarcity is already generating a wave of excitement in the numismatic world. But for investors, particularly those navigating turbulent financial waters in traditional markets, it will be the new unlimited-mintage sovereign that redefines the landscape. With gold prices rising, markets nervous and confidence in physical assets (or real assets) high, these security features offer exactly the assurance that modern investors desire.
The return to yellow gold draws on centuries of tradition, while the reinforced design propels the sovereign into the future. Above all, the new sovereign offers a unique advantage: it is classified as legal tender in the United Kingdom, which means it is exempt from capital gains tax.
Collectors want tradition. Investors demand security, and tax advantages don’t hurt either. In 2026, the Royal Mint has met both needs with a coin steeped in history, yet the most technologically advanced of its kind.
Disclaimer
This post expresses the personal opinions of the Custodia Wealth Management staff who wrote it. It does not constitute investment advice or recommendations, personalised advice, and should not be considered an invitation to carry out transactions on financial instruments.
