the Fatwa Department Research Committee - chaired by Sheikh `Abd al-Wahhâb al-Turayrî
Originally, the Zakâh on gold and silver was paid as a percentage (2.5%) of the gold or silver itself. Gold and silver were the currency at that time. Therefore, if a person had kept a thousand gold coins (dinâr) in savings for a year, he would simply pay 25 gold coins as Zakâh at the end of that year.
Today, gold and silver are not used as currencies, but rather as an investment. Consequently, people usually prefer to pay the value of the gold or silver in in cash so they can keep their investment intact.
The present market value of the gold or silver at the time of paying Zakâh should be used to determine the amount of Zakâh that is due, since paying the equivalent in currency is taking the place of paying the Zakâh from the precious metal itself.
And Allah knows best.
Source: Islam Today