Türkiye’s digital gold boom: Certificates outperform physical bullion

As record-breaking prices continue to drive global momentum toward gold, Turkish investors are increasingly turning to gold certificates traded on Borsa Istanbul. These instruments, which generally reflect gold price expectations three to four months in advance, have recently outperformed physical gold by more than 20% in returns, driven by heightened investor demand.

Since the beginning of the year, physical gold has appreciated by 36.67% against the Turkish lira. In comparison, the yield on Turkish gold certificates—traded under the ticker ALTIN.S1 on Borsa Istanbul—has climbed as high as 47% over the same period. This outperformance is largely attributed to several investor-friendly features, including exemption from taxation, the absence of storage costs, and the ability to convert the certificates into physical gold upon request.

As of 11 a.m. GMT on Friday, the ALTIN.S1 certificate—each representing 0.01 grams of gold—was trading at ₺44.93 ($1.17) on Borsa Istanbul.

Issued in November 2022 by the General Directorate of Mint and Stamp Printing House under the Treasury and Finance Ministry, the certificates aim to encourage citizens to integrate their gold holdings into the financial system rather than keeping them outside of it.

Turkish gold certificates over bullion: Profitable but volatile

Two of the key reasons behind the strong demand are the zero tax rate and the narrow spread between buying and selling prices. In contrast, holding physical gold often incurs additional costs such as safe deposit fees, which do not apply to certificates.

These certificates are also redeemable in physical gold upon request through a formal written application. The minimum threshold for conversion is 50 grams, with additional conversions possible in increments of 10 grams. While bank deposits are insured up to ₺950,000, gold-backed certificates are covered up to the equivalent of 1 kilogram of gold, offering a higher level of security for substantial holdings.

Moreover, the ability to trade these certificates instantly and conveniently through online brokerage platforms has made them increasingly attractive to retail and institutional investors alike.

However, a key risk remains as potential profit-taking in global gold prices, particularly in ounce and gram gold markets, may trigger sharper corrections in ALTIN.S1 prices due to the narrow bid-ask spread.

Türkiye imported an average of 10,474 kilograms (368,061 ounces) of gold per month in 2024. In March alone, the country imported 10,314 kilograms, solidifying its position as one of the world’s leading gold consumers, according to Borsa Istanbul’s monthly report on the Precious Metals and Gemstones Market.