The non-loony ETFs, Swiss vault storage, etc. Let's simplify to "the GLD ETF" [1]. This of course isn't really gold, it's paper gold (and has in fact been fractional-reserve-banked: there is far more paper gold than actual gold).
The loony gold storage: gold bars under your pillow. Unfortunately, the gold people use for payments is extremely regulated, specific grades of gold, guaranteed by a very small number of financial institutions (and numbered). Whilst at least these are obviously not oversubscribed, if you have one you can't sell it (aside from the subdivision problem), because there's no easy way to verify the guarantees, and there are an untold number of fakes in circulation.
[1] tradingview.com/e/?symbol=GLD