Claims that gold will be upgraded to a high-quality banking asset this July are false, the London Bullion Market Association said, debunking widespread online reports about changes to Basel III banking rules.
The LBMA said inaccurate reports falsely claim gold will be reclassified as a “High Quality Liquid Asset” under Basel III banking regulations starting July 1, 2025.
“This information is not correct; no official announcement has been made or is expected on gold gaining HQLA status,” according to the LBMA’s official statement.
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The confusion stems from mixing up regulatory frameworks. Gold has maintained Tier 1 capital status with zero risk weighting since 1988 — the same as cash. However, High Quality Liquid Asset designation falls under separate liquidity rules.
“People are getting mixed up between capital rules and liquidity rules,” the LBMA said.
Under current Basel III rules, gold faces an 85% required stable funding factor because it remains outside the official High Quality Liquid Asset list, according to regulatory documents. Physical gold continues as a Tier 1 asset, while “paper” gold positions face higher requirements.
Despite regulatory limitations, central banks increased gold reserves by 244 metric tons in Q1 2025, up 24% from the five-year average, according to World Gold Council data.
Read: Gold Overtakes Euro As Second Largest Global Reserve Asset, Driven by Central Bank Demand
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