Warehouse receipt
A warehouse receipt is a document of title for a stored commodity. How warehouse receipts work, why markets use them, and how they apply to uranium.
A warehouse receipt is a document of title that evidences ownership of a specific quantity of a commodity held in a licensed storage facility. Commodity markets have used warehouse receipts for well over a century, for metals, grain, and energy products, because they let ownership be transferred, traded, or financed without physically moving the goods.
How a warehouse receipt works
A warehouse operator stores the commodity and issues a receipt stating the quantity, grade, and location. The holder of the receipt has a claim to the stored commodity. The holder can take physical delivery by presenting the receipt, sell the receipt to someone else, or pledge it as collateral for a loan. A buyer of the receipt acquires the claim without the commodity leaving the warehouse.
Why commodity markets use warehouse receipts
Warehouse receipts separate trading a commodity from moving it. When receipts are standardized by quantity, grade, and approved location, one receipt can be exchanged for another, and a market can form around them. Exchange-traded metals contracts, for example, are physically settled by the delivery of warehouse warrants.
Warehouse receipts and uranium
Uranium has historically had no standardized, tradable receipt, which is one reason it settles slowly and trades bilaterally. A digital warehouse receipt applies the established instrument to physical uranium. Each receipt represents one pound of U₃O₈, is backed 1:1 by physical uranium held at an accredited U.S. conversion facility, and is redeemable for physical delivery through physical settlement. Reserves are checked through published proof of reserves.
FAQ
A warehouse receipt is a document of title showing that the holder owns a specific quantity of a commodity stored in a licensed facility. It lets the commodity be sold, transferred, or used as collateral without moving it.
Warehouse receipts are used to trade, transfer, and finance stored commodities. A holder can sell the receipt, pledge it as collateral, or present it to take delivery of the commodity. Standardized receipts also form the basis of physical settlement in many exchange-traded commodity markets.