Part three of The Gold Story. Parts one and two counted the physical metal: where it came from, how much exists. This part is about the gold that exists only on paper, and it relies almost entirely on the London market’s own published documents, quoted directly. We think people should know how the plumbing works before they decide what to hold.
A river of gold flows through London every day
The London over-the-counter market is the centre of world gold trading. Its own clearing statistics for May 2026 show an average of 16.1 million ounces of gold settled every trading day, worth about 73.7 billion dollars, and the LBMA describes the market as clearing over 20 million ounces a day on average (LBMA clearing data). Those are the netted settlement figures. Gross turnover reported by LBMA members runs far higher: roughly 960 billion dollars a week as of July 2026, implying in the order of 190 billion dollars of gold traded per day (LBMA trade data). For comparison, the world’s mines produce about 12 billion dollars of new gold a month at current prices. London trades more gold in a morning than the planet digs up in a month.
Most of it is a claim, not a bar
How can that much gold change hands? Because most of it is not bars moving between vaults. It is entries on account. The LBMA’s own guidance states that probably in excess of 90 per cent of the wholesale market clears across what are called unallocated accounts (LBMA).
The legal meaning of unallocated matters, and here it is in the clearing system’s own words. The holder of an unallocated account does not own specific bars. They hold a general entitlement to metal, a contractual claim on the bullion bank. As London Precious Metals Clearing Limited puts it plainly: the owner is an unsecured creditor of the clearing member (LPMCL). If the institution fails, the unallocated holder stands in the queue with everyone else the bank owes money to.
An allocated account is the opposite: specific, numbered, weighed bars held in custody. The holder keeps title; the vault is merely a warehouse. Allocated gold is yours. Unallocated gold is a promise from a bank denominated in gold. Both have their uses in a professional market. But they are not the same thing, and the difference only ever matters on the one day it matters completely.
The context: a world running on promises
This paper-and-promise structure sits inside a wider one. The International Monetary Fund’s Global Debt Database records world debt at 251 trillion dollars in 2024, a little over 235 per cent of global output (IMF). Meanwhile the institutions that issue the world’s money have been quietly choosing for themselves: central banks bought 1,045 tonnes of gold in 2024, their third consecutive year above a thousand tonnes and their fifteenth consecutive year of net buying, led by Poland, Turkey and India (World Gold Council). Draw your own conclusions. We simply note that the people who print promises have been steadily swapping them for metal.
What this has to do with a jewellery house
A hallmarked piece of gold in your hand is the oldest form of allocated gold there is. Nobody stands between you and it. No account, no counterparty, no queue of creditors. It needs no electricity and no login. That has been true for five thousand years, and it is why the next part of this series goes back to the beginning: the pharaohs, the first coins, and what every civilisation since has decided gold is for.