Tokenized commodities based on blockchain technology are approaching the $4 billion mark, following new record highs for the world’s leading precious metals.
On Friday, gold, silver, and platinum reached unprecedented levels, with spot gold soaring to $4,530 per ounce, as per TradingView data. Silver, while not a significant player in the tokenized commodities market, briefly peaked at an all-time high of $74.56 per ounce.
In the month leading up to Friday, tokenized commodities saw an 11% increase, reaching $3.93 billion, according to the data aggregator RWA.xyz. Tether Gold (XAUt) remains the largest tokenized commodity at $1.74 billion, followed closely by Paxos Gold (PAXG) at $1.61 billion.
These tokenized precious metals can be traded on-chain outside of traditional market hours; however, their pricing, liquidity, and redemption are still linked to legacy systems.
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Tokenized commodities fall under the broader real-world asset (RWA) category, which involves issuing blockchain representations of traditional assets for quicker settlement and fractional ownership.
Investment bank Standard Chartered forecasts that the tokenized RWAs (excluding stablecoins) will skyrocket to $2 trillion by 2028, with $250 billion expected to flow into “less liquid” investments like private equity and commodities.
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Ethereum dominates RWA tokenization growth
Ethereum is emerging as the leading blockchain network for tokenized RWAs.
It holds a 65% market share of tokenized RWAs, valued at $12.7 billion, with BNB Chain in second place at 10.5%, or $1.85 billion, according to data from RWA.xyz.
The growth in tokenization could lead to increased activity and transaction fees on Ethereum.
However, blockchain data indicates that the tokenization of traditional financial assets still represents a relatively minor portion of on-chain activity, compared to more established sectors like stablecoins and fungible token trading.
In the past 30 days, Ethereum ranked fourth in total transaction fees, generating $11.41 million, according to data from crypto intelligence platform Nansen.
The Tron network, which focuses on stablecoin activities, topped the list with $29.5 million in fees, followed by BNB Chain and Solana in second and third place, respectively. Both blockchains are popular for token launches and retail trading.
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