Mining Weekly

North American numbering agency CUSIP Global Services (CGS) is collaborating with precious metals depository Delaware to create CUSIP identifiers for physical precious metals.

The security identifiers, which will be assigned by CGS to Delaware’s fungible products, will be used to help standardise the process of trading and tracking precious metals within investor portfolios.

Built on the standard nine-digit CUSIP taxonomy that is commonly found in equity and fixed-income markets, the identifiers will initially be assigned to 93 different precious metals product types housed by Delaware. The standardised CUSIP identifiers will complement the proprietary, internal product codes Delaware had been using previously to track and manage their clients’ assets.

“The introduction of the CUSIP identifiers into the precious metals market represents an enormous step forward in the pursuit of a more modern, efficient and transparent marketplace,” says Delaware MD Jon Potts.

He says that the company views this “critical first step” as an exciting opportunity to take a leadership role in the precious metals industry.

While the collaboration initially covers fungible precious metals, CGS plans to expand its precious metals offerings to cover nonfungible products as well, including individual gold bars with unique serial numbers from accredited refiners.

“Though it is arguably one of the world’s oldest asset classes, gold is one of the last to receive CUSIP identification. As markets and trading and portfolio management mechanisms become increasingly electronic, the need for a universal standard is growing quickly,” states CGS market, business and product development director Matthew Bastian.