50% target of bars from recycled gold reached in Royal Mint Gold ETC

08 February 2024

  • The Royal Mint Responsibly Sourced Physical Gold ETC (RMAU) now has over 50% of the bars in its custody comprised of 100% recycled gold.
  • 50% is the target watermark for RMAU to have a majority of its bars from recycled gold
  • RMAU is the world’s first gold ETF or ETC to be backed by recycled gold bars.
  • The ETC allows investors to invest in gold with a lower carbon footprint, backed not only by recycled gold, but also 100% LBMA post-2019 responsibly sourced good delivery bars – the highest standard available.
  • Pandora the World’s largest jewellery company recently announced it will only use precious metals from recycled sources.
 

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February 2023, London

HANetf, Europe’s first and only independent white-label UCITS ETF and ETC platform[1], and leading provider of digital asset ETPs, is delighted to announce that over 50% of gold bars custodied by The Royal Mint Responsibly Sourced Physical Gold ETC (RMAU) are sourced from 100% recycled gold for the first time.  

In March 2022, The Royal Mint partnered with Quintet Private Bank to introduce the use of 100% recycled gold in an exchange traded commodity. This made RMAU the world’s first gold ETF or ETC ever to be backed by recycled gold bars.

Gold mining is an energy intensive process, with the process of extracting and grinding ore requiring almost 90,000 kilojoules (KJ) per gram of gold produced. Unlike many other commodities, gold can be infinitely recycled with no degradation in quality. This allows investors to access gold while reducing the emissions footprint of their portfolios.

As shown in the table below, recycled gold is over 90% less carbon intensive than mined gold.

Source

CO2 Emissions (kg)

Reduction

Mining  

16.3

 -

Recycling (E-Waste)

1.02

93.7%

Recycling (Other)

0.03

99.8%

Outside of financial services, there is increasing awareness of the importance of recycled gold. Apple has already begun using recycled materials and plans to use 100% recycled gold in its circuit boards by 2025. Meanwhile, Pandora, the World’s largest jewellery company, announced only last week it will be shifting to 100% recycled gold and silver for its jewellery—a move they predict will avoid 58,000 tons of COemissions annually.

In only two years, the proportion of recycled gold in RMAU’s custody has surged to over 50%. Thanks to the unique partnership with The Royal Mint, there is close control over the ETC’s supply chain, allowing for the percentage of recycled gold to steadily increase. The Royal Mint intends to continue to add recycled gold bars as the ETC continues to grow with the target of remaining at over 50%.

RMAU was the first financial listed product to be sponsored by The Royal Mint, and the first gold ETC to be launched in partnership with a European sovereign mint.[2] It provides investors with exposure to the spot price of gold by physically holding gold bars, which are custodied at The Royal Mint’s highly secure vault in Llantrisant, Cardiff. The ETC has accrued $720 million in assets under management (AUM) with a peak AUM of $900m.

RMAU also gives investors the opportunity to access gold that aligns with their values. The Royal Mint’s unique control over the bullion in their custody means that the ETC is 100% backed by London Bullion Market Association (LBMA) post-2019 responsibly sourced Good Delivery bars, meaning that the gold adheres to the highest responsible sourcing standard within the industry. We believe, therefore, that RMAU appeals to sustainable investors that may not have had previous exposure to gold but are interested in the responsibly sourced gold ETC’s unique values.

The gold is sourced by an experienced in-house procurement division, which prioritises ethical sourcing of precious metals. This is bolstered by The Royal Mint’s partnership with the World Gold Council and adherence to their Retail Gold Investment Principles. This was evidenced when RMAU was the first Gold ETC to remove Russian bars following the start of the Ukraine war.

Crucially, RMAU will only issue gold ETCs once gold has been allocated—these are uniquely identifiable gold bars which are held on a segregated basis by the custodian. All gold held in custody on behalf of investors, therefore, is fully allocated. Full details of the gold bars held, including regular independent audits, are included on the HANetf website.

Uniquely, RMAU also allows physical redemption into coins and bars for end investors. This was demonstrated by RMAU having its first physical redemption in 2022. Wahed redeemed a 1 oz gold bar, accentuating the fund’s commitment to offering physically backed gold.

 

Steven Jones, Business Development Manager at The Royal Mint, comments:“The Royal Mint is dedicated to promoting sustainability across our entire business landscape. We’re pleased to be working with HANetf to champion responsible sourcing and circular economy practices. It’s a fantastic milestone to reach – surpassing 50% of RMAU gold bars being derived from 100% recycled gold - and underscores our joint commitments to reducing our carbon footprint.

“We have ambitions to increase this number, enabling investors to invest in gold with a lower carbon footprint, backed by recycled gold and LBMA post-2019 responsibly sourced good delivery bars.”

Hector McNeil, Co-Founder and Co-CEO of HANetf comments:"We are delighted to see the percentage of recycled bars custodied by RMAU surpass 50%. The groundbreaking move to include recycled gold in an exchange traded product marked a worldwide first – and since then, the amount of recycled gold has been steadily growing. We had the target of a majority of the gold bars from recycled sources from the day we added this feature to the ETC and are proud to have hit this in advance of our original timetable. Alongside the fact all bars meet the post 2019 LBMA responsible sourcing standards mean that investors who want to invest in gold sustainably will see RMAU as a great option.

“RMAU is a unique way to gain exposure to responsibly sourced gold. Its bars are 100% in compliance with the LBMA’s post-2019 Responsible Sourcing guidelines. The ETC is also independently audited to add a further level of assurance as to the adherence of these strict standards, and is shariah-compliant. This allows investors to access gold that aligns with their values.”

  

Past performance is not indicative of future performance. When you invest in ETFs your capital is at risk.

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