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A New Gold Coin for a Changing Gold Market
In 1987, the term ‘gold bullion’ still conjured up images of Goldfinger, Sovereigns worn as rings and Krugerrands from apartheid-era South Africa, whose import the British Government had recently banned. With the US ending the dollar's convertibility into gold in 1971, followed by the imposition of 15% VAT on gold bars in the UK in 1973 and its extension to gold coins in 1982, physical gold had become a niche pursuit, largely the preserve of coin collectors and specialist investors.
It was into this world that Nigel Lawson, the Master of Britain's Royal Mint, decided to introduce a new British bullion coin. The Britannia was designed to enhance Britain's global image while competing with the new generation of bullion coins emerging from the United States, Canada and Australia as investors looked for alternatives to the Krugerrand. When Britannia launched on 14 October 1987, an ounce of gold was worth around £279, equivalent to about 1.4 weeks' average earnings (now about 4.2 weeks’). Alongside the one-ounce coin, half-ounce, quarter-ounce and tenth-ounce versions offered investors different entry points into the market.
Britannia Meets Black Monday
Two days after Britannia launched, the London Stock Exchange suspended trading and closed early due to a severe storm, and by the close of the following Tuesday the FTSE 100 had dropped 23% in two days, in an event now known as Black Monday. An article in Forbes magazine declared that The Royal Mint’s finance director ‘couldn’t be happier’ as conditions looked set to provoke a rush to ‘safe-haven assets’ like gold. But Britannia's ambitions initially ran ahead of reality. Despite some early success, The Royal Mint and HM Treasury soon regarded the project as a disappointment, prompting The Royal Mint to investigate what had gone wrong. Its findings pointed to overoptimistic assumptions about demand, tougher competition than expected and, crucially, the significant barrier created by VAT. The challenge for Britannia was therefore not simply to create a compelling coin, but to persuade a new generation of investors that physical gold belonged in their portfolios.
From Gold to Silver
A decade later, The Royal Mint broadened the Britannia proposition beyond gold. In 1997, marking the coin's tenth anniversary, the Britannia range was expanded into silver, offering investors and collectors a lower-cost way to own precious metal bearing one of Britain's most recognisable national symbols. The first silver Britannias were struck in 958 fine 'Britannia silver', rather than pure silver, and extended the brand into a market that would ultimately become just as important to Britannia's global story as gold.
The VAT Barrier
But as Britannia entered its second decade, the investment landscape was changing. For years, MPs, investors and bullion dealers had argued that VAT on gold coins was a significant barrier to investment. The breakthrough came on 1 January 2000, when new rules across Europe removed VAT from qualifying investment gold, including Britannia coins. A tax that had added 17.5% to the purchase price disappeared as we entered the new millennium, and this made physical gold considerably more competitive. At almost exactly the same time, the internet was beginning to transform investing. Prices, market information and specialist bullion dealers were suddenly accessible to anyone with a connection, opening up the gold market to a new generation of retail investors.
Gold’s Role Questioned
But greater access did not mean greater appetite. At the turn of the millennium, gold looked increasingly like a 20th century investment. The Berlin Wall had fallen, Eastern Europe was democratising, China was joining the World Trade Organisation and globalisation appeared to be ushering in a new era of stability and prosperity. Western investors increasingly favoured equities and other financial assets, while gold's role as a portfolio diversifier and safe haven faded from view. Britannia was not immune. As demand for traditional bullion coins weakened, The Royal Mint began refreshing its bullion designs, using Britannia's enduring identity to generate new interest in the coin. By the mid-2000s, the UK physical bullion market had become heavily concentrated among British Asian investors. Industry estimates suggested that as many as 90% of retail physical gold bullion buyers in the UK were of British Asian heritage, reflecting both cultural traditions and memories of economic and currency shocks that kept gold's importance alive in other parts of the world.
Gold Reinvented
In 2003, gold investing was completely reinvented. The first gold ETFs made it possible to buy exposure to gold as easily as buying a share. Investors no longer needed to buy, transport and store physical metal, or gain exposure indirectly through mining companies and derivatives. Gold had become a financial asset as well as a physical one, opening the market to a much wider institutional and retail audience. One of the pioneers was Nik Bienkowski, who was involved in the development of the world’s first gold ETC in 2003. Nearly two decades later, the story came full circle when Bienkowski co-founded HANetf and partnered with The Royal Mint to launch The Royal Mint Responsibly Sourced Physical Gold ETC (RMAU) in 2020, bringing together exchange-traded accessibility and The Royal Mint's unique expertise. And the journey can come full circle again, with investors able to convert their RMAU holdings into physical gold Britannias, connecting an exchange-traded investment with the tangible gold it represents.
A New Chapter
A few years later came the crisis that changed everything. The Global Financial Crisis shattered confidence in banks, markets and the financial system itself. Gold's qualities suddenly looked less like relics of the past and more like essential portfolio tools. Western investors rediscovered gold as a safe haven and diversifier, while central banks shifted from decades of selling to sustained accumulation. For Britannia, this marked the beginning of a new chapter. The Royal Mint began treating bullion as a strategic business in its own right, while upgrading Britannia to compete in an increasingly international market. No longer would the design alternate, instead Philip Nathan’s original 1987 design became the staple, ensuring the coin was easily recognised, and enhancing liquidity. In 2013, the gold Britannia moved from 22-carat, 916.7 fine gold to 24-carat, 999.9 fine gold, while the silver Britannia moved from 958 fine silver to 999 fine silver, aligning both coins with international bullion standards. In 2014, The Royal Mint began selling bullion directly to the public through its website, bringing live-price investment in gold and silver from the vault to the investor's screen.
But as the market and prices grew, so did the incentive of counterfeiters, and a new question emerged: how can you trust what you are buying? World Gold Council research in 2019 identified trust and confidence as major barriers to gold investment. Britannia answered with one of the most significant innovations in its history. From coins dated 2021 onwards, four advanced security features, microtext, tincture lines, surface animation and a latent image, were built into the design. Developed by The Royal Mint's expert craftspeople, they transformed Britannia into one of the world's most secure bullion coins, giving investors something remarkably simple: the ability to authenticate gold with their own eyes.
The Tax Advantage
And Britannia has another advantage that has become increasingly valuable as the investment landscape has changed: tax efficiency. When Britannia launched in 1987, the annual Capital Gains Tax allowance threshold was £6,600, equivalent to around £21,000 today. Since then, the allowance has fallen dramatically to just £3,000, while the main rates of CGT have risen in recent years. Britannia's status as UK legal tender means it remains exempt from CGT, giving investors a rare combination of physical ownership, liquidity and tax efficiency. As portfolios have grown and tax has become an increasingly important consideration in investment decisions, this advantage has become more valuable, particularly for investors holding significant amounts of gold, silver or platinum.
Forty Years of Evolution
Forty years on, Britannia has evolved as the gold market evolved. From a new British bullion coin launched into a world where gold was losing its relevance, it has become a globally recognised investment product designed for the modern investor. Its story mirrors the transformation of gold itself: from physical metal held by a relatively narrow group of investors and collectors, to a mainstream portfolio asset available through coins, bars, digital platforms and exchange-traded products. Yet while the ways of investing in gold have multiplied, the fundamental appeal of owning physical gold coins has endured.
Today, Britannia sits at the heart of that market. It is currently the world's best-selling bullion coin in both gold and silver, outcompeting coins from South Africa, the United States and elsewhere on the global stage. Its buyers span generations, geographies and investment philosophies. Some are buying their first ounce of gold; others are building substantial long-term holdings. What unites them is the same proposition that has carried Britannia through four decades of change: a globally recognised bullion coin, backed by the heritage of Britain's sovereign mint, designed for the investor of today.
Recent research shows that while just 8% of UK adults knowingly invested in gold over the past 5 years, 33% regret not doing so. Gold has risen 128% over that period, while silver has increased by 126%, equivalent to annualised returns of around 18% in both cases. For investors who did participate, those gains have been particularly significant because UK bullion coins such as Britannias can also offer an important tax advantage: as UK legal tender, Britannias are exempt from Capital Gains Tax meaning any profits made would be tax-free for UK individuals. The combination of exceptional price performance, accessibility and tax efficiency has helped transform Britannia bullion coins from a niche holding into a credible and growing component of modern investment portfolios.
Now the Britannia is the UK’s, and the world’s, bullion coin of choice. Britannia coins make up 50% of our online bullion sales and are chosen by 37% of our online bullion customers, including 41% of first-time buyers. Internationally, Britanina’s largest markets are the United States, Germany, Singapore and Switzerland.
Four decades after its launch, Britannia therefore finds itself in a very different gold market from the one it entered in 1987. The technology, tax landscape and ways of accessing gold may have changed, but the fundamental proposition remains familiar: a tangible precious metal, represented by a coin with a history, identity and global recognition. Perhaps that is the most enduring part of Britannia's story. The market around it has continually changed, but the appeal of owning precious metals remains remarkably resilient.
