- The World Gold Council is developing a shared infrastructure service to simplify the creation and management of tokenized gold assets.
- The initiative, dubbed “Gold as a Service,” aims to standardize custody and issuance pipelines, lowering barriers to entry for new issuers.
- Current market leaders like Paxos and Tether have built bespoke systems, contributing to a combined tokenized gold market cap of $4.9 billion.
- The Council sees tokenization as a strategic expansion of its mission, having previously helped launch the first U.S. gold-backed ETF.
The World Gold Council unveiled plans on Thursday to create standardized infrastructure for digital gold tokens, seeking to replicate its success with traditional gold ETFs in the crypto market. This “Gold as a Service” framework, detailed in a white paper co-authored with Boston Consulting Group, addresses the complex custody and management of physical reserves.
Consequently, the council views the current need for bespoke vaulting arrangements as a major barrier for new entrants. Mike Oswin, the Council’s Global Head of Market Structure and Innovation, stated, “At the end of the day, [gold] is a physical asset that comes in different sizes, shapes, forms, locations. It’s always been an inhibitor.”
Meanwhile, crypto-native firms have already established significant market dominance through their own systems. For instance, Tether Gold and Paxos‘ PAX Gold have a combined market value of $4.9 billion, according to data from CoinGecko.
However, these companies manage their own separate custody pipelines, such as vaults in London and Switzerland. Oswin believes a shared service could foster a broader market, enabling potentially hundreds of new products by simplifying access to physical gold in a cost-effective way.
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