Senate bill would require 2 approved metals vaults per time zone

A proposal in the U.S. Senate targets a quiet but important piece of the financial system: the vaults that store gold and silver tied to exchange trading. Lawmakers say too much of that metal is stored in one region, and they want the system spread across more of the country.

The bill, called the System Integrity through Licensed Vault Expansion and Resilience Act, or SILVER Act, would amend the Commodity Exchange Act. Its goal is to reduce systemic risk and increase competition among facilities that store precious metals used in futures contracts and other exchange‑linked trades.

Today, metals used in these markets are often required by exchange rules to be stored close to New York City, long the center of U.S. futures trading. The bill argues that concentrating so much storage in a single region creates a vulnerability if logistics problems or transportation disruptions affect that area.

Why lawmakers see a concentration problem

The proposal says geographic concentration can ripple through the bullion market. When storage options cluster in one place, it can limit available supply for trading, reduce liquidity, and increase costs for companies that store, finance, and transport precious metals.

Lawmakers also point to recent strains in global metals markets as a reminder that access to physical metal matters. If fewer vaults are available or they are located far from major shipping routes or metal processing centers, the flow of metal into exchange trading can tighten.

At the same time, the legislation notes that existing exchange‑approved vaults maintain strong security standards and play an important role in market confidence.

Opening the door to more vaults

The SILVER Act would require systemically important derivatives clearing organizations to use clear and transparent criteria when approving vaults that store metals tied to futures contracts. Those organizations would also have to provide a formal process for facilities to apply for approval.

When selecting depositories, clearing organizations would need to consider factors such as geographic diversity, competition, risk management, storage costs for market participants, and broader systemic risk.

The bill also sets a geographic expectation. Clearing organizations would be required to approve at least two qualifying depositories in each U.S. time zone: Eastern, Central, Mountain, and Pacific.

A broader storage network