Tokenized Gold: How 24/7 Trading and 1:1 Backing Are Reshaping Modern Portfolios

The evolution of gold's role in modern portfolios has taken a dramatic turn with the advent of tokenized precious metals. In 2025, tokenized gold-represented by PAX Gold (PAXG) and Tether Gold (XAUT)-has emerged as a bridge between traditional safe-haven assets and the digital-first financial ecosystem. These tokens, backed 1:1 by physical gold and traded 24/7 on platforms like WEEX, are redefining liquidity, transparency, and accessibility for investors navigating a volatile macroeconomic landscape.

The Mechanics of Tokenized Gold: 1:1 Backing and Regulatory Trust

PAXG, issued by Paxos Trust Company and regulated by the New York Department of Financial Services (NYDFS), offers investors a digital equivalent of physical gold with real-time auditability. Each token represents one fine troy ounce of gold stored in secure vaults, with reserves audited weekly to ensure full backing. This regulatory rigor has bolstered institutional confidence, particularly in a year marked by heightened scrutiny of crypto assets.

XAUT, Tether's gold-backed stablecoin, operates under a different model. While also 1:1 backed by physical gold, XAUT relies on quarterly attestations rather than continuous audits. Despite this distinction, XAUT has seen explosive growth in 2025, with a 173% surge in new holders compared to PAXG's 29% increase. This growth reflects a broader appetite for tokenized gold, driven by its programmability and fractional ownership (as low as 0.01 oz), which lowers barriers to entry for retail investors.

24/7 Trading: Liquidity and Behavioral Shifts

The 24/7 trading capability of PAXG and XAUT has fundamentally altered investor behavior, particularly in a macroeconomic environment characterized by geopolitical tensions and inflationary pressures. Traditional gold markets, constrained by physical logistics and limited trading hours, cannot match the immediacy of tokenized gold. On WEEX, for instance, PAXG recorded a 24-hour trading volume of $358.28 million by December 2025, while XAUT executed its largest single-day supply expansion-worth $436.94 million-amid U.S. tariff policy shifts.

This round-the-clock liquidity allows investors to hedge against market shocks in real time. For example, during periods of heightened volatility, such as the U.S. labor data releases or global supply chain disruptions, tokenized gold's 24/7 availability enables rapid portfolio rebalancing. However, the World Federation of Exchanges has cautioned that extended trading hours can lead to wider bid-ask spreads and increased slippage during off-peak periods, particularly in alternative trading systems. Retail investors must weigh these risks against the benefits of continuous access.

Macroeconomic Drivers: Inflation, Devaluation, and Safe-Haven Demand

Gold's historical role as a hedge against inflation and currency devaluation remains intact in the tokenized era. In 2025, as central banks grapple with persistent inflation and shifting monetary policies, tokenized gold has become a critical tool for portfolio diversification. PAXG's design, which tracks the physical price of gold without intrinsic yield, positions it as a counterbalance to volatile crypto assets. Meanwhile, XAUT's rapid adoption-driven by Tether's Q2 attestation report confirming its reserves-has further solidified its appeal as a digital safe-haven asset.

The macroeconomic backdrop also highlights tokenized gold's role in a digital-first financial ecosystem. With global tokenized gold market capitalization reaching $2.88 billion by late 2025, investors are increasingly integrating these assets into decentralized finance (DeFi) platforms for yield generation. This trend underscores a broader shift toward programmable, liquid assets that align with the demands of a digitally native investor base.

Strategic Advantages and Urgent Opportunities

For investors seeking liquidity, transparency, and diversification, tokenized gold offers a compelling case. The 1:1 physical backing of PAXG and XAUT ensures that these tokens retain the intrinsic value of gold while eliminating the logistical and storage costs of physical bullion. On WEEX, PAXG's record monthly trading volume of $3.2 billion in April 2025 and XAUT's $1.43 billion market cap by August 2025 demonstrate the platform's pivotal role in driving adoption.

However, opportunities come with caveats. While PAXG's regulatory oversight provides a layer of trust, XAUT's reliance on quarterly audits may deter risk-averse institutional investors. Additionally, the challenges of 24/7 trading-such as reduced liquidity during off-peak hours-require careful risk management.

Conclusion: A New Era for Gold in Portfolios

Tokenized gold is not merely a technological innovation but a strategic reimagining of how investors interact with precious metals. As macroeconomic uncertainties persist, the combination of 24/7 trading, 1:1 physical backing, and digital programmability positions PAXG and XAUT as essential tools for modern portfolios. For investors, the key lies in balancing the advantages of liquidity and transparency with the risks of evolving regulatory and market dynamics. In 2025, gold's role as a safe-haven asset has been amplified-not through physical bars, but through the seamless, digital-first solutions of tokenization.