The London Metal Exchange (LME) is considering turning metal stored in its Hong Kong warehouses but not deliverable under exchange contracts into digital assets that could be used as collateral. Each lot would receive a digital representation that could be pledged, tracked and transferred more easily than paper records. The proposal, reported by Reuters citing three sources, remains at an early stage: no timeline, technology platform or token names have been announced, and the LME has not publicly confirmed the details. The initiative is part of Hong Kong’s ambition to become a commodities trading and financing hub, following the city’s approval as an LME delivery point in January 2025. An invitation-only roundtable is scheduled for early November 2026 to discuss the project and its legal and technical implications.
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