What Is Tokenized Gold? PAXG, XAUT and the Risks

Tokenized gold is a token on a blockchain that an issuer says corresponds to a defined amount of physical gold held by a custodian. Holding it means holding a claim under the issuer's terms, recorded in a wallet, not holding a bar. The well-known examples are PAX Gold (PAXG), issued by Paxos Trust Company, and Tether Gold (XAUT), issued by Tether.

It is not the same as a tokenized share of a gold fund. Those follow a fund rather than metal in a vault, and Lzzo.com lists them with tokenized stocks.

Paxos states that one PAXG is one fine troy ounce of gold, stored in LBMA vaults in London and held in custody by Paxos Trust Company. Holders can redeem for LBMA-accredited Good Delivery gold bars or, at current gold market prices, for US dollars, and Paxos publishes monthly attestation reports.

Tether states that one XAUT is one troy ounce of gold on a London Good Delivery bar held in Switzerland, with physical redemption in Switzerland above a minimum amount. Matrixdock Gold (XAUM) also stands for one ounce, while Kinesis Gold (KAU) stands for one gram. Minimums, fees and identity checks are set by each issuer and can change, so check the current fee schedule before relying on redemption.

A token trades on venues like any other crypto asset, so its price comes from supply and demand there, not from a formula the issuer applies. Lzzo.com's PAXG page says the token is designed to stay close to the price of an ounce of gold, with small differences possible; its XAUT page says the price shown may differ from the spot price of gold.

Redemption is open only to holders who meet the issuer's conditions, so for most holders the market price is the price at which a token can actually be sold. A lira value adds a second movement: it is the dollar price multiplied by the dollar/lira rate.

Gold itself can move sharply in price. A token adds further layers:

• Issuer risk: the holder relies on the issuer to hold the gold and honor redemption; Lzzo.com's PAXG page names this counterparty risk.
• Verification risk: an attestation covers the reserves on the dates it describes, and Lzzo.com does not audit reserves.
• Redemption conditions: minimums, identity checks and regional limits apply.
• Price gaps: the market price can differ from the gold price.
• Irreversible transfers: a token sent to a wrong address or a look-alike contract cannot be reversed.
• Platform risk: an exchange or wallet holding the token adds its own failure risk.

Türkiye's main crypto-asset rules come from Law No. 7518, published in the Official Gazette (Resmî Gazete) on July 2, 2024, issue 32590. It adds a broad definition of crypto asset to the Capital Markets Law, requires service providers to hold authorization from the competent authority and attaches criminal penalties to unauthorized activity. Whether a particular gold token falls under that definition or other rules is a legal question this guide does not answer. This is not legal or tax guidance, and later regulations are not covered.

The tokenized commodities list shows gold and silver tokens in US dollars, each with the time of its observation, and every token has its own price page. On October 12, 2026 (08:13 UTC) the list held six assets. Prices are for information only and are not trading guidance.