the reality of the derivative paper market in Gold is that the...

the reality of the derivative paper market in Gold is that the majority of contracts will be settled in fiat.
If a big player had the temerity to demand physical delivery it would break the market and send Gold parabolic.
Consequential to that : would be that the govt would step in and a request made to accept fiat settlement, like they did with Buffet when he strangled the Silver market and demanded physical delivery.
If they played hardball then a series of mysterious accidents and suicides would possibly occur.
This is why we are seeing a big divergence between the paper price and the physical price as physical bullion becomes scarce due to high demand and reducing supply.