4 Billion Dollar Giant Gold Transfer from London to New York

A noteworthy development has emerged in Venezuela's multi‑year‑old gold reserves, held in lock‑up in the United Kingdom. Negotiations between the Venezuelan government and the opposition, aimed at moving roughly 31 tonnes of gold from the Bank of England vaults in London to the New York Fed in the United States, are approaching a conclusion.

According to a Financial Times report based on sources close to the matter, a new formula is being developed between the interim administration led by Delcy Rodríguez and opposition representatives regarding the future of the gold worth about 4 billion dollars.

GOLD WILL NOT RETURN TO VENEZUELA

The most striking point of the plan on the table is that the gold will not be physically sent to Venezuela.

If the plan is implemented, the reserves could be moved from the Bank of England vaults in London to the Federal Reserve Bank of New York. Another option under consideration is having the reserves managed by the U.S. Treasury Department.

The Delcy Rodríguez administration could have legal control over the gold, but it would not be able to sell the reserves directly and convert them into cash.

31 tons of gold can be used as collateral

Using gold as collateral for Venezuela's borrowing, instead of this, is in the news

It is said that the financing that could be secured this way could be directed to the reconstruction work carried out after the earthquakes that struck Venezuela in June

However, access to gold is expected to be subject to strict controls. It is reported that the opposition wing present at the talks also wants the use of the reserves to be kept under control

Held in London vaults for years

The approximately 31-ton reserve has long been at the center of the legal and political dispute between Venezuela and the United Kingdom

The origin of the crisis lies in the United Kingdom's refusal to recognize the legitimacy of Nicolás Maduro's administration following the controversial presidential election in Venezuela in 2018. The UK was among the countries that recognized Juan Guaidó as interim president in 2019, and access to Venezuela's gold had also become the subject of a protracted process in British courts.

Can Be Transferred from London to New York

If the final formula is accepted, Venezuela will have taken an important step toward regaining legal control over its reserves. However, roughly $4 billion worth of gold will be moved from London to New York instead of returning to Caracas, and significant restrictions will be imposed on its use.

For the Bank of England to release the gold, the legal process in British courts must also reach a conclusion.

Thus, although a new era for the Venezuela gold held in London for years is on the agenda, the physical return of the 31‑ton reserve to Venezuela or its direct sale by the government is not on the table for the time being.