Investors turn to digital gold for greater flexibility during volatile markets.
Dubai: An increasing number of investors are turning to tokenised gold, attracted by the ability to trade, transfer, and manage their exposure in real time during periods of heightened market volatility.
The trend has accelerated through 2026, especially following escalating geopolitical tensions in the Middle East, which reinforced gold’s appeal as a defensive asset while highlighting the limitations of traditional investment channels.
Tokenised gold—which represents ownership of physical bullion via blockchain networks—has grown in market size to over $6 billion. It tracks the broader rise in gold prices and has attracted investment from both crypto-native users and traditional investors.
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The appeal of tokenised gold lies in its combination of traditional stability with the flexibility and accessibility of digital infrastructure.
Vincent Chok, Founder and CEO of First Digital, noted that investors are increasingly looking beyond traditional formats. “Investors are no longer just seeking the stability of gold; they want the liquidity and programmability that only tokenisation can provide, allowing them to hedge risk in real time, even when traditional exchanges are closed.”
Market conditions have reinforced this shift. Gold prices surged sharply at the onset of the Middle East conflict, reflecting renewed safe-haven demand, while tokenised formats enabled investors to respond instantly to fast-moving developments.
Many users are drawn to tokenised gold because it combines exposure to bullion with features unique to digital assets, such as 24/7 trading, fractional ownership, fast transferability, agentic trading, and, in some cases, redemption into physical gold. In 2026, tokenised gold mirrored broader increases in gold prices, while the on-chain tokenised-gold market surpassed $6 billion.
Outperformance within crypto markets
Tokenised gold has also stood out within the broader digital asset ecosystem, where volatility has weighed on many crypto-native projects, according to Sergej Kunz, Co-founder of 1inch.
Sergej Kunz, Co-founder of 1inch, explained that the difference lies in underlying value. “Tokenised gold is backed by an asset that has been rallying, while much of DeFi remains tied to crypto-native risk and sentiment.”
In risk-off conditions, capital has rotated toward assets with clearer backing and lower volatility.
This dynamic has enabled tokenised gold protocols to outperform large parts of the decentralised finance market, offering a bridge between traditional safe-haven assets and on-chain accessibility.
The rise of tokenised gold also reflects a broader trend of real-world assets moving onto blockchain infrastructure.
Sergej Kunz, Co-founder of 1inch, said the implications extend beyond individual investors. “Tokenised assets could become the preferred format for software, because they are programmable, liquid, and instantly usable across crypto-native infrastructure.”
This shift is reshaping capital flows between traditional finance and digital ecosystems, with tokenised commodities emerging as a key entry point.
As the on-chain economy matures, tokenised real-world assets like gold are becoming a natural extension of the broader DeFi ecosystem rather than a competitor. Their performance reflects growing demand for digital assets that combine blockchain programmability with the reliability of traditional financial instruments.
Institutional interest builds
Vincent Chok, Founder and CEO of First Digital, noted that institutional appetite is beginning to form, driven by familiarity with gold and the operational advantages of tokenisation.
Vincent Chok, Founder and CEO of First Digital, said the transition is already underway. “On-chain gold replaces the need for physical vaulting and manual settlement with blockchain-based ownership records that can be transferred or redeemed instantly, at any time.”
He added that regulatory clarity will play a decisive role, with jurisdictions such as the UAE well-positioned to attract institutional activity as frameworks develop.
Risks remain despite growing demand
Despite strong momentum, tokenised gold carries inherent risks linked to the structure of each product.
Sergej Kunz, Co-founder of 1inch, highlighted the importance of verifying how assets are backed. “Investors should first assess issuer and custodian risk, because tokenised gold is only as credible as the legal claim, the reserves, and the redemption process behind it.”
Liquidity conditions and regulatory treatment can vary significantly across platforms and jurisdictions.
The increasing adoption of tokenised gold is transforming how investors manage risk within digital portfolios.
Chok said the shift is already evident. “RWA tokenisation expands the investment toolkit, providing access to safe-haven assets without requiring investors to leave the on-chain ecosystem.”
This evolution suggests a future where portfolios integrate traditional assets with digital infrastructure, with gold serving as a familiar anchor amid a rapidly changing financial landscape.
