Tokenized Gold Attracts $4B as Whales Hedge Volatility

• Tokenized gold TVL surged to $4B in 2025 as investors sought inflation hedges according to reports.
• Crypto whales pivoted to gold tokens amid Bitcoin's 2025 decline and gold's 65% rally as data shows.
• Tokenization enables 24/7 trading and fractional ownership of physical gold bars according to analysis.
• Central bank gold demand remains strong with 755 tonnes expected in 2026 as research indicates.

Tokenized gold holdings surpassed $4 billion in 2025 as institutional and retail investors embraced blockchain-based precious metal exposure according to reports. This asset class combines gold's traditional safe-haven appeal with digital advantages like instant settlement and DeFi integration. Major platforms like Paxos and Tether now dominate this rapidly expanding market segment according to analysis.

Why Are Investors Flocking to Tokenized Gold?

Gold surged 60% in 2025 amid geopolitical tensions and falling real yields according to data. Tokenized versions like PAXG and XAUT captured this demand through enhanced accessibility. Investors gain exposure without physical storage limitations while maintaining 1:1 gold backing verified by regular audits as analysis shows. Crypto whales particularly favored these tokens when Bitcoin declined 7% last year according to reports.

Tokenized gold integrates smoothly into DeFi ecosystems for yield generation. This programmability creates new utility beyond traditional bullion according to analysis. Fractional ownership allows micro-investments as small as 0.01 ounces, democratizing access according to reports. These features explain why tokenized gold now anchors the $4B real-world asset tokenization market according to data.

How Does Tokenized Gold Bridge Traditional and Digital Finance?

Tokenization transforms physical gold into on-chain assets tradable 24/7 according to analysis. This eliminates traditional market hours and settlement delays. Platforms like Bitget TradFi enable cross-market trading where gold tokens serve alongside forex and commodities according to reports. Such integration reflects the Fed's endorsement of tokenization for modernizing financial infrastructure according to analysis.

Institutional adoption grows as firms like tZERO expand custody solutions for tokenized assets according to reports. Their broker-dealer infrastructure meets SEC standards for digital asset security according to analysis. Meanwhile, projects like MatrixDock demonstrate how tokenization creates new gold investment vehicles according to reports. This convergence accelerates as traditional finance embraces blockchain efficiencies according to analysis.

What Risks and Opportunities Lie Ahead for Tokenized Assets?

Regulatory uncertainty remains the primary institutional barrier according to Goldman Sachs. Custody solutions must evolve to prevent operational breaches in digital asset management according to analysis. Tokenized gold also faces traditional gold market risks like weaker physical demand in Asia and potential policy shifts according to data.

Opportunities abound as tokenization expands beyond gold to stocks and real estate according to reports. Central bank digital currency initiatives could further legitimize tokenized assets according to analysis. With gold allocations still historically low in portfolios, tokenized versions offer efficient exposure according to data. The market expects continued growth as blockchain infrastructure matures according to reports.