Tokenized Precious Metals Gain Momentum as Tether and DeFi Drive RWA Growth
Precious metals industry expert Andy Schectman discussed how Tether's massive gold accumulation and new DeFi integrations are transforming physical gold and silver into liquid, productive digital collateral.
Tokenized gold and silver are seeing rapid adoption as blockchain infrastructure increasingly connects real-world precious metals with decentralized networks. In a recent market discussion, Miles Franklin president Andy Schectman pointed out that digitizing physical commodities resolves historical challenges related to divisibility, settlement, and transportation. A major driver behind this trend is stablecoin issuer Tether, which has accumulated over 27 metric tons of physical gold this year, placing its purchasing volume on par with major sovereign central banks.
### Policy Legislation and Reserve Accumulation Schectman highlighted how upcoming policy shifts, such as the Genius Act scheduled for early next year, could institutionalize stablecoin settlement backed by short-term U.S. Treasuries. He theorized that stablecoin issuers acquiring physical gold from interest earned on reserves could ultimately support systemic adjustments to U.S. trade deficits and dollar valuation. This demand coincides with unusually high physical delivery requests on futures exchanges like the COMEX, signaling sustained institutional appetite for physical settlement over paper contracts.
### Precious Metals as Productive DeFi Collateral The integration of tokenized gold and silver onto networks like Solana and Ethereum is expanding precious metal utility beyond passive storage. On platforms such as Aave, Uniswap, EtherFi, and Jupiter, tokenized assets like Pax Gold and Dominion Silver can now be utilized as productive collateral to earn yield or back loans without selling the underlying asset. Schectman noted that direct digital ownership and DeFi-enabled liquidity could pose a direct challenge to legacy precious metal exchange-traded funds (ETFs) by providing greater accessibility and lower friction for investors.