On August 1st the US Federal Reserve published<\/a> a note on international experience with revaluing gold reserves. According to its author, Colin Weiss, over the past 30 years Germany, Italy, Lebanon, Cura\u00e7ao and Sint Maarten, and South Africa have taken such a step.<\/p>\n By his calculation, if the United States revalued its 261.5m ounces of gold, it would yield about 3% of GDP\u2014roughly $900bn\u2014without actually selling the metal. How that is possible, and how it could affect crypto, is set out below.<\/p>\n Gold monetisation is a way to turn a state\u2019s bullion stock into ready money without selling the precious metal. Instead of selling bars, the government revalues them.<\/p>\n In the US reserves, gold is still booked at $42 per ounce (the 1973 standard), even though its market price now exceeds $3,300 per ounce.<\/p>\n<\/div>\n At the new price the Treasury issues gold certificates and transfers them to the Fed. The Fed, in turn, credits dollars to the Treasury\u2019s account. Formally the money is backed by gold, but in substance it is created out of thin air. The state need not take on new debt\u2014indeed, the proceeds can be used to reduce it and to buy back Treasuries.<\/p>\n There were precedents. In 1933 President Franklin Roosevelt seized<\/a> the public\u2019s gold and soon raised its price from $20.67 to $35 per ounce (about 69%). The step effectively devalued the dollar and generated substantial profit for the Treasury, allowing it to top up the Exchange Stabilization Fund and expand the monetary base. The Fed received gold certificates at the new price, increasing its issuance capacity: at the time the dollar required partial gold backing.<\/p>\n In 1971 President Richard Nixon ended<\/a> the dollar\u2019s link to the metal, effectively devaluing it. The official price was then raised\u2014to $38 in 1972 and to $42.22 in 1973. In those years the Treasury used<\/a> the monetisation mechanism: it issued gold certificates at $38 and handed them to the Fed, which credited the difference to the department\u2019s account. Without selling a single ounce, the government padded the budget by roughly $800m and channelled the funds into the economy.<\/p>\n Such actions shook confidence in the dollar: it became evident that the United States would resort to stealth issuance if it needed to plug a budget hole in a hurry.<\/p>\n The Fed\u2019s note points to the experience of other countries, acknowledging that such measures do not fix structural problems: in Lebanon debt kept rising despite retiring some bonds via revaluation, and in South Africa the effect is not yet clear. In Germany the step was taken to comply with budget rules or to lower debt-service costs, but it sparked debate over the permissibility of such interference in the central bank\u2019s work.<\/p>\n In February 2025 the Financial Times<\/a> noted that the debate over gold monetisation is taking place at a high level. In the view<\/a> of macro strategist Luke Gromen, revaluation to $20,000 per ounce would enable the issuance of up to $5trn. By his calculations, that would cut the debt-to-GDP ratio from about 122% to around 70%.<\/p>\n Gromen added that such a step is \u201ca real option expressly spelled out in Federal Reserve documents,\u201d citing an excerpt<\/a> as evidence:<\/p>\n “The Secretary of the Treasury is authorized to issue gold certificates to Federal Reserve Banks for the monetization of gold owned by the Treasury.”<\/p>\n<\/blockquote>\nWhat gold monetisation means<\/strong><\/h2>\n
History repeating?<\/strong><\/h2>\n
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