Physical Gold Vs Digital Gold In 2026: A Very Malaysian Dilemma

I have always loved gold. Not in the abstract, portfolio-allocation sense but in the very real, emotional way many women grow up with. Gold bangles gifted at weddings. Chains bought after a milestone. Earrings that quietly sit in a locker but somehow make you feel secure just knowing they are there.

So when my husband said earlier this year, “Let’s buy gold,” I was immediately on board. I was already mentally picturing coins, bars, something solid we could hold. Then he finished his sentence.

“Digital gold.”

I laughed, because somehow I already knew where this was heading.

That small exchange captures a much bigger question many Malaysian households are grappling with today. Gold still feels safe. What is less clear is how we should own it now. Do we stick to physical gold, the way our parents did? Or do we embrace digital gold products that promise convenience, lower costs and easier management?

The answer, as it turns out, is not as simple as tradition versus technology.

Why gold still feels relevant in 2026

Despite the rise of ETFs, crypto assets and increasingly attractive savings accounts, gold has hardly lost its shine. Global demand climbed to 5,002 tonnes in 2025, a record high driven primarily by investment demand rather than jewellery, the World Gold Council notes. In other words, gold buying today is less about tradition and more about caution in an unpredictable market.

For Malaysians, gold sits in a unique space. It is cultural, emotional and financial all at once. It is also one of the few assets that feels understandable across generations. That familiarity is exactly why the form of gold ownership now matters more than ever.

What “physical” and “digital” gold really mean in Malaysia

When we talk about physical gold, we are referring to gold you can take possession of. This includes bars, coins and jewellery. In Malaysia, one of the most recognised investment-grade options is Kijang Emas, issued and guaranteed by Bank Negara Malaysia. Bank Negara explicitly states that Kijang Emas is legal tender, which gives it a level of institutional backing that many private bullion products do not.

Digital gold, on the other hand, is a much broader category. In Malaysia, it typically includes:

• Gold investment accounts offered by banks, where you buy and sell gold in grams on a statement rather than taking delivery
• Gold exchange-traded funds (ETFs) listed on Bursa Malaysia, such as the TradePlus Shariah Gold Tracker
• Gold-linked derivatives such as gold futures, which are designed for trading and hedging rather than long-term holding

Some newer platforms also market tokenised or digital asset-based gold products, which fall under the oversight of the Securities Commission Malaysia if structured as regulated digital assets. This distinction matters because not all “digital gold” carries the same risk profile.

The emotional comfort of physical gold (and its real drawbacks)

I understand instinctively why physical gold feels safer. You can see it. Touch it. Put it somewhere secure and know it exists regardless of what happens to apps, platforms or passwords.

But physical gold also comes with realities we do not always like to talk about:

• Storage risk is entirely on you. Whether it is a home safe or a bank locker, there is always a cost or risk involved.
• Liquidity friction is real. Selling physical gold often means accepting a dealer’s buy-back price, which can be meaningfully below spot. Jewellery, in particular, loses value because workmanship premiums are rarely recovered.
• Authenticity concerns still exist, especially outside established dealers or official issuers.

Physical gold is excellent for long-term wealth preservation, gifting and emotional security. It is less efficient if your goal is flexibility or regular portfolio rebalancing.

Why digital gold suddenly makes sense (even if it feels less romantic)

This is where my husband’s argument started to make more sense.

Digital gold products, particularly Bursa-listed gold ETFs, are built for modern investing. For example, the TradePlus Shariah Gold Tracker states that it invests at least 95 per cent in physical gold, stored in a secured vault in Singapore, with insurance coverage and periodic audits. Investors can buy and sell units on Bursa during market hours, without worrying about storage or insurance.

From a cost perspective, digital gold often wins over time. There are management fees, yes but these are usually lower than the combined premiums, spreads and storage costs associated with physical gold. Liquidity is also smoother. You can sell part of your holding easily, instead of liquidating an entire bar or coin.

That said, digital gold introduces counterparty risk. You are relying on custodians, trustees and regulators to ensure the gold exists and is properly safeguarded. This is why sticking to regulated products under Bursa and the Securities Commission is crucial.

A simple comparison for gold investment in Malaysia  in 2026

Aspect	Physical gold	Digital gold
Emotional comfort	Very high	Lower
Storage responsibility	Yours	Handled by platform
Liquidity	Dealer-dependent	Market-based
Ongoing costs	Storage, spreads	Management fees
Counterparty risk	Minimal (once you take possession)	Present but regulated
Best for	Long-term holding, legacy	Portfolio allocation, flexibility

So which did we choose?

In the end, we did not choose one over the other. We split the role.

We bought a small amount of physical gold because it matters to me emotionally and culturally. It feels like security I can see. But we also allocated a larger portion to regulated digital gold, because it simply works better as part of a modern investment portfolio.

That compromise felt very 2026. Tradition but with structure. Emotion, backed by regulation.

And honestly, that might be the most Malaysian answer of all.