Tokenized gold capitalization has crossed the $1.2 billion mark

This growth is due to soaring gold prices and growing interest in blockchain assets. The growing interest in gold-backed crypto assets is part of a broader movement to modernize the storage

Tokenized gold capitalization has crossed the $1.2 billion mark. This growth is driven by soaring gold prices and growing interest in blockchain assets.

The growing interest in gold-backed crypto assets is part of a broader movement to modernize the storage, trading, and use of the precious metal in financial markets.

Gold meets blockchain in the age of tokenization

The price of gold has steadily been climbing to new heights after surpassing $3,000 per ounce in March. Along with this growth, digital incarnations of precious metals such as Tether Gold (XAUT) and Paxos Gold (PAXG) are attracting close investor attention.

1-week chart of XAU/USD

Don Tapscott, co-founder of the Blockchain Research Institute, asserts that tokenized gold has the potential to transform the $13 trillion gold market, bringing transparency, liquidity, and new financial models.

Gold has been a store of value for millennia—but why are we still storing it the same way we did in the 1800s. While Bitcoin and stablecoins have gone digital, gold remains locked away in vaults, underutilized and undervalued on the books. That’s changing. Tokenized gold—backed…

Based on this assumption, he wondered why gold is still held in vaults like it was in the 1800s while assets like Bitcoin and stablecoins like USDT have gone digital. Tapscott believes blockchain technology could revolutionize gold's role in finance.

"The U.S. government could even tokenize its gold reserves, track them immutably, and use them in innovative ways," Tapscott explained.

He noted that such a move would allow for fractional ownership, blockchain verification, and increased accessibility for investors around the world.

Meanwhile, companies like Paxos and Tether lead the way in tokenized gold offerings, with Paxos holding 51.74% of the market and Tether following close behind at 46.69%.

Tokenized gold products. Source: rwa.xyz

"We believe that the next generation of financial giants is likely to emerge from the tokenization revolution. It’s still early days, and the playing field is wide open. Matador and others have the bull by the horns," noted Tapscott in a recent article.

Gold tokenization in the US – A bold policy shift?

The momentum behind tokenized gold has also reached the US government. Following President Trump's March 5 order to create a strategic Bitcoin reserve (SBR), policymakers are exploring ways to modernize gold holdings.

Treasury Secretary Scott Bessent indicated that the U.S. will "monetize its assets," leading some to speculate the possibility of tokenizing Fort Knox gold.

"U.S. Treasury Secretary Scott Bessent says all the GOLD is there because he has no plans to visit Fort Knox or revalue the GOLD reserves in the sovereign wealth fund. He says this on 'Bloomberg Surveillance'," noted Erik Yeung.

Senator Cynthia Lummis also suggested that some of the U.S. government's gold reserves be exchanged for Bitcoin. U.S. gold reserves are carried at a book value of $42 per ounce - it hasn't changed since 1973 - even though the market price exceeds $3,000 per ounce.

While the US is exploring tokenization, geopolitical rivals China and Russia could take the even bolder step of launching a gold-backed stablecoin. Bitcoin maximalist Max Keiser recently drew attention to the BRICS' plans to introduce a gold-backed stablecoin.

"The BRICS, principally Russia, China & India, will counter any attempt by the US to introduce a hegemonic, USD-backed stablecoin — with a Gold-backed stablecoin. The majority of the global market will favor a Gold-backed coin since it’s inflation-proof (unlike the USD) and doesn’t boost unwelcome US hegemony. India already runs on a de facto Gold standard, and Sharia law in Muslim countries would dictate Gold over a USD riba-coin as well. To be clear, a BTC-backed stablecoin is not fit for purpose due to volatility," Kaiser stated.

In addition, Kaiser suggested that gold-backed Bitcoin will outperform USD-backed Bitcoin in competing in global markets. He argues that gold is more trusted than the USD, it effectively tracks inflation and remains minimally volatile compared to Bitcoin price fluctuations.

With an estimated 50,000 tons of combined gold reserves, China and Russia could use blockchain technology to create a new gold-backed digital asset. Such an action would challenge the dominance of the U.S. dollar in global trade.

Gold vs. Bitcoin – Safe haven debate intensifies

Gold's record rally has rekindled the debate about its role as a safe haven asset compared to Bitcoin. Some analysts suggest Bitcoin may soon follow gold's trajectory, setting new all-time highs.

However, amid economic uncertainty and