Tokenization of Gold: A New On-Chain Paradigm for Reshaping Safe-Haven Assets

I. Introduction: The Return of Risk Aversion Demand in the New Cycle

Since the beginning of 2025, the global situation has been turbulent, with weak economic growth and a renewed demand for safe-haven assets. Gold, as a traditional safe-haven asset, has once again become the focus, with gold prices breaking through the $3000 per ounce mark. Meanwhile, "tokenization of gold" has become a new trend in financial innovation. It not only retains the value-preserving properties of gold but also possesses the liquidity, composability, and smart contract interaction capabilities of on-chain assets. An increasing number of investors and institutions are beginning to include tokenized gold in their investment strategies.

2. Gold: The "hard currency" that remains irreplaceable in the digital age

Despite constant innovations in financial markets, gold maintains its status as the "ultimate store of value asset" due to its unique historical position, value stability, and cross-sovereign attributes. Gold is referred to as "hard currency" not only because of its scarcity and non-falsifiability but also because it represents a long-term consensus of thousands of years in human society.

In recent years, central banks around the world have continued to increase their gold holdings, especially emerging economies showing positive performance. This reflects the growing importance of gold as a strategic asset against the backdrop of the ongoing restructuring of global trade patterns and geopolitical dynamics. At the same time, amid high global debt levels and expanding fiscal deficits, gold's "no counterparty risk" characteristic has become even more prominent.

Although gold has shortcomings such as low trading efficiency and difficulties in physical transfer, this has prompted its evolution towards "tokenization of gold". This shift is no longer a competition between gold and digital currencies, but rather a combination of value-anchor assets and programmable financial protocols.

It is worth noting that gold and Bitcoin have a complementary rather than an absolute substitute relationship in positioning. Gold, with its large spot market, mature financial derivatives system, and broad acceptance at the central bank level, still maintains the triple advantages of being counter-cyclical, low volatility, and high recognition.

3. Tokenization of Gold: On-chain Representation of Assets

Tokenization of gold is a technology and financial practice that maps gold assets in the blockchain network as encrypted assets. It maps the ownership or value of physical gold as on-chain tokens through smart contracts, enabling gold to circulate and combine freely on-chain in a standardized and programmable form.

The generation of tokenized gold typically relies on two paths: one is the custodial model of "100% physical collateral + on-chain issuance", and the other is the protocol model of "programmatic mapping + verifiable asset certificates". Regardless of the path taken, the core goal is to build a mechanism for the trusted representation, liquidity, and settlement of gold on-chain.

The greatest value of tokenization of gold lies in the fundamental transformation of the functionality of the gold market. It provides a new form of gold that is divisible, can be settled in real-time, and is capable of cross-border flow, significantly broadening the application scenarios of gold in DeFi and global financial markets. At the same time, it also drives the gold market's shift from centralized infrastructure to decentralized infrastructure.

4. Analysis and Comparison of Mainstream Tokenization Gold Projects

Current representative tokenization gold projects include Tether Gold (XAUT), PAX Gold (PAXG), Cache Gold (CGT), Perth Mint Gold Token (PMGT), and Aurus Gold (AWG), among others.

Tether Gold and PAX Gold are the current duopoly in the industry, leading in market capitalization and liquidity, with a mature custodial system and strong brand endorsement. The characteristic of Tether Gold is that it is pegged one-to-one with standard gold bars in the London gold market, but is relatively conservative in terms of transparency. PAX Gold, on the other hand, has gone further in compliance and asset transparency, actively expanding DeFi compatibility.

Cache Gold represents an attempt that leans more towards decentralized and verifiable asset certificates, using the "Token Wrapper + Gold Bar Number Registration" system. Perth Mint Gold Token is launched by an official Australian agency, possessing high security and official endorsement, but lagging in market liquidity.

Innovative projects like Aurus Gold are attempting to create a new paradigm of tokenized gold through diversified custodians, NFT packaging, and cross-chain issuance.

The future tokenization of gold standards may evolve towards four directions: compliance, verifiability, composability, and cross-chain capabilities.

5. Tokenization of Gold from the Investor's Perspective: Value, Opportunities, and Risks

The appeal of tokenization of gold to investors lies in its ability to find a balance between "financial stability anchor" and "technological innovation dividend." It inherits the fundamental investment logic of gold as a safe-haven asset while endowing gold assets with unprecedented liquidity and accessibility.

Tokenization of gold is gaining composable financial properties, becoming a component module of on-chain native assets. Investors can obtain stablecoins through collateral, participate in liquidity mining, or transfer across chains in multi-chain interoperability protocols.

However, tokenization of gold still faces custodial and redemption risks, external risks of compliance and regulation, as well as limitations in becoming a dominant asset in actual investment portfolios.

For individual users, tokenization of gold is a way to enhance asset risk resistance and make counter-cyclical allocations; for institutions, it may become a "base asset" in building on-chain portfolios.

6. Conclusion: The on-chain upgrade of gold is not a replacement, but a continuation.

In an era of reshaping the global currency landscape, gold is undergoing a process of "digital rediscovery." It participates in the construction of the new financial system in a more flexible form through tokenization, programmability, and smart contracts. For users, this evolving gold remains a "hard currency," just in a different on-chain form, becoming a true "stable anchor" in the digital world.