Intercontinental Exchange (ICE) is set to begin trading precious metals derivatives in London this week, introducing futures contracts in the world's leading physical bullion hub.
The new products include futures for gold, silver, platinum, and palladium, all linked to ICE's daily London auctions. London handles more than $190 billion in over-the-counter physical gold transactions each day and holds approximately $1.4 trillion worth of bullion. The city's pricing mechanism is also used as a benchmark for the global precious metals industry and investment products worldwide.
Renewed Push for London Futures
London has struggled to establish a successful gold futures market in recent years. The London Metal Exchange closed its gold futures contract in 2022 after five years of weak trading volumes. An earlier attempt, the London Gold Futures Market, ended in the mid-1980s.
Trade tensions and economic sanctions have also reshaped global precious metals markets. Following tariff actions in April 2025, dealers moved significant amounts of gold to the United States after New York futures prices rose above physical prices in London.
"Derivatives markets generally exist to support the physical market," said Chris Rhodes, president of ICE Futures Europe.
He added that London remains the center of the physical market and that giving participants additional ways to manage risk could create an attractive opportunity, particularly when futures are linked directly to auction prices.
Central Banks Reassess Gold Storage
Central banks are also reassessing where they store their gold reserves. Last month, the Dutch central bank moved more than 78 tonnes of gold from New York to London, citing "increasing geopolitical unrest" and concerns over potential government actions.
Hong Kong and Singapore are expanding their gold storage facilities, while France and India have repatriated gold reserves to their respective countries.
Venezuela is also seeking to move around $4 billion worth of disputed gold reserves from the Bank of England to New York.
Gold reached a record above $5,500 per troy ounce in January. Meanwhile, CME Group's US gold futures averaged around $125 billion in daily trading volume during the first half of the year.
ICE's London contracts will be settled against the physical auction prices managed by the exchange for all four metals. Contract maturities will range from same-day settlement to six months.
Clearing will be handled through ICE's London clearing division, which also operates Brent crude oil futures.
Since acquiring the gold benchmark a decade ago, ICE's auction has expanded from four participating companies to 20, including Jane Street, DRW, Goldman Sachs, and Citi. Daily auction volumes have risen above 424,000 ounces, representing growth of more than 30% since 2015.