Gold Pricing Transitioning to Blockchain Network
As the U.S. futures market wraps up at the end of the week, gold prices are set to shift to a blockchain platform, according to Iggy Ioppe, former chief investment officer at Credit Suisse and now the chief investment officer at liquidity infrastructure firm Theo.
The CME gold futures will halt trading at 5 PM ET on Friday and pick back up at 6 PM ET on Sunday. During this break, the regulated futures market will be mostly inactive, with trading shifting to undisclosed private over-the-counter deals mainly in Asia.
This means that tokenized gold assets like PAXG and XAUt will keep trading over the weekend, representing one of the few market instruments that still directly ties to gold.
“In terms of publicly visible price formation, nearly all of the price discovery over the weekend comes from on-chain markets,” Ioppe shared with Cointelegraph.
He also mentioned that when futures trading resumes, the prices often align with the movements already seen in the blockchain market. “Weekend activities reflect when CME reopens,” he noted.
Growth of Tokenized Gold Market
This transition comes as the tokenized gold trading volume rises significantly. Cointelegraph reported that the tokenized gold sector has accelerated greatly over the past year, with its market value jumping nearly $2.8 billion, elevating its cap from around $1.6 billion to $4.4 billion.
The market capitalization in this sector rose by 177%, which far outstrips the overall gold market and major spot gold ETFs, and the number of holders has nearly tripled, with over 115,000 new wallets created. This growth is notable, comprising roughly a quarter of total net inflows in real assets and surpassing the growth in tokenized equities or corporate bonds.
The trading activity has surged, with tokenized gold trading volume hitting about $178 billion in 2025 and peaking over $126 billion in the fourth quarter. At this rate, it could become the second-largest gold investment option globally, trailing only SPDR Gold Share regarding trading volume.
Ioppe indicated that market makers and liquidity providers dominate, exploiting the price disparities between the digital and traditional markets. Crypto-focused macro traders have also become pivotal, using tokenized gold to gain exposure to gold prices, as collateral, and for hedging strategies amid geopolitical and economic uncertainties.
“Some financial institutions are closely monitoring on-chain gold markets over weekends, especially macro desks that assess gap risks before CME reopens,” he mentioned, observing that most are treating the information as data rather than a basis for active strategies.
Continuous Trading for Risk Management
Tokenized gold markets provide a continuous trading framework that enhances risk management. If a geopolitical crisis unfolds while the futures market is off, traditional traders can’t adjust their holdings. However, tokenized markets allow for immediate rebalancing.
On a recent Saturday, Bitcoin (BTC) and Ether (ETH) dipped, while tokenized gold saw gains, as investors turned to XAUT and PAXG amidst escalating geopolitical tensions following a U.S. and Israeli strike on Iran. XAUT briefly surpassed $5,450 during the day, while PAXG approached $5,536 before tapering off, according to CoinMarketCap data.
Nevertheless, Ioppe pointed out existing barriers to wider adoption. Liquidity remains lower compared to futures and ETFs, making it tricky to execute large trades without affecting prices. “While regulatory clarity is improving, fragmentation across different regions is slowing down the system’s rollout. Rules around custody, accounting, and capital differ widely,” he explained.
For the time being, tokenized gold is expected to coexist alongside traditional products rather than replace them. “The most likely short-term scenario is that tokenized and traditional markets will run in parallel, each serving unique purposes,” Ioppe concluded.
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