Tokenized commodities could grow from a market dominated by gold into a broader system for financing metals, trading energy and borrowing against physical assets, according to executives at Paxos Labs, Theo and Energy Substantiation.
Putting commodities on blockchain networks should do more than make them easier to buy, the executives say. It could connect investors seeking exposure and income with businesses that need inventory financing, opening markets traditionally reserved for large institutions.
The starting point remains modest. Tokenized commodities’ market capitalization reached $5.55 billion at the end of March 2026, up from $1.43 billion at the beginning of 2025, according to CoinGecko. Gold-backed tokens from Paxos and Tether accounted for almost 90% of that growth.
Tokenized commodities are blockchain-based tokens that represent ownership of, or exposure to, physical assets such as gold, silver and oil.
Its PAXGy token is backed by PAX Gold , with reserves deployed to institutional borrowers. Each token is designed to become redeemable for more PAXG as underlying lending rates are paid back in ounce terms, allowing holders to potentially increase their gold holdings while retaining price exposure.
“The big proposition is access,” co-founder Bhau Kotecha told CoinDesk in an interview. Gold lending has historically required scale and relationships unavailable to many investors, he said.
Kotecha sees demand from individuals, family offices and institutions, with borrowing against PAXGy a possible next step. Lending returns are not guaranteed, and borrower defaults could erode the token’s value.
Silver offers another route into that financing market. Theo’s thSLVR product passes income from institutional silver leases to holders while maintaining exposure to the metal’s price.
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