99% of Digital Gold Is Sitting Idle. It's a $700 billion opportunity with four barriers, and I think users will unlock it before regulators do. The @GOLDCOUNCIL and @BCG recently released a report titled "Digital Gold: Unlocking a $700 billion Opportunity". In it they surveyed more than 12,000 retail investors across 12 markets, interviewed 20 industry experts and modelled three growth scenarios to 2031. The report's conclusion was that "nearly 9 in 10 retail investors signal a willingness to invest in digital gold under the right conditions... If stakeholders address the principal barriers to adoption... (they could unlock)... up to $700 billion in latent demand. Fully realised, this would create a market that broadly matches physically-backed gold ETFs today." If you're interested in demand for digital gold like we are at @xash , this report's tune should be sweet music to your ears. But I wondered if the report's conclusions are supported by our current state of readines? The report suggests that the four barriers to digital gold adoption are: Trust - Is it safe and legitimate? Is there a clear and accessible path to physical gold redemption? Is it well regulated and are consumer protections in place? Access - Can I buy and hold it through apps I'm familiar with, like banking or payment apps? Utility - What can I do with it beyond holding it? Earn a yield? Borrow against it, or pay with it? Cost - Is pricing competitive with other gold investments, like physical gold and gold ETFs? I decided to look into the progress we're making to address these barriers and where the biggest opportunities lie. Trust Progress so far Indonesia: In March 2026, Indonesia's financial regulator, OJK, and the government published a six-year bullion roadmap to formalize the country's gold banking industry. Indonesia already licenses bullion banks, which hold gold for customers under rules that keep that gold safe if the bank fails. OJK is also testing gold tokens in its regulatory sandbox, where firms can trial new products under supervision before rules are written. That makes rules specifically for tokenized gold look likely, in a market that already has scale. US: In December 2025, the OCC, which charters and supervises America's national banks, conditionally approved Paxos, which issues the PAXG gold token, to become a national trust bank. Paxos has 18 months to pass its final exam. Today, PAXG buyers rely mostly on Paxos's own monthly reports that the gold is there. Once the charter is final, the issuer of the second-largest gold token will be supervised by the same federal regulator as America's national banks. India: Millions of Indians buy digital gold through apps that buy and store the gold for them, but no regulator checks that the gold exists. With India's securities regulator declining to step in, the country's digital gold sellers formed their own self-regulatory body, DPMACI, in May 2026. Its members include the refiner MMTC-PAMP, digital gold providers SafeGold and Augmont, and payment apps such as PhonePe, MobiKwik and CRED. They've signed up to a common code that requires every gram sold to be backed by physical gold and independently audited, with customer money held separately under an independent trustee. Redemption, Matrixdock: In April 2025, Matrixdock, a Singapore-based issuer of the XAUm gold token, completed the first publicly documented physical redemption of a gold token. Holders can take delivery of a 1 kg bar (32.148 XAUm) in Singapore or Hong Kong, a fraction of the size of a wholesale 400 oz bar. The report says more redemption locations and lower minimums "would fuel demand," and Matrixdock moves on both. Where the opportunity is EU: The EU's crypto rulebook, MiCA, requires issuers of tokens backed by assets such as gold to be authorized before they can sell to the public. No issuer in that category has been authorized yet. As a result, Binance, the world's largest crypto exchange, delisted PAXG for European users from March 31, 2025. The rules are in place, so the first gold token authorized under MiCA will open up 27 countries that currently have no regulated option. US: In September 2026, the CLARITY Act, the bill that would set out how US crypto markets are regulated and divide oversight between the SEC and CFTC, failed a key Senate vote. Neither regulator has said whether a gold token is a security, a commodity or something else, so buyers don't know which regulator protects them. That leaves the largest investment market open for the products that build demand first to help shape the rules that follow. India: On November 8, 2025, SEBI, India's securities regulator, warned investors that digital gold is neither a security nor a commodity derivative, sits outside its oversight and carries no investor protection. Two weeks later, its chair said SEBI isn't looking to regulate it. That leaves the industry, through DPMACI, to set the standard for protection in one of the largest digital gold markets, and the products that protect buyers best to win their trust. Redemption, PAXG: To swap PAXG for metal, a holder needs "430 PAXG plus applicable fees per bar," for a bar held in London, and pays for delivery. At today's gold price, 430 PAXG is worth well over $1 million. Bringing that threshold down to retail sizes, as Matrixdock has started to do, is one of the clearest ways for issuers to win retail trust. Access Progress so far Brazil: In April 2026, Itaú, Brazil's largest bank, added PAXG to the crypto service in its main banking app. The report lists four signs that digital gold is breaking out, and this is the second, "major banks putting digital gold in their apps," and the first time a major bank outside Asia has offered a public gold token in its main app. India: Indians buy digital gold in small amounts through payment apps like PhonePe and Google Pay, using UPI, the national phone-payments network. Those purchases hit a record 254 million transactions in March 2026, more than double the 103 million in September 2025, even with the regulator's warning in between. Familiar apps kept people buying. Indonesia: Pegadaian, Indonesia's state-owned pawn and gold company and a licensed bullion bank, launched its Tring! app in October 2025 around digital gold savings, with purchases starting at Rp 10,000 (about $0.60). Customers topped up more than 3.3 tonnes of gold savings in Q1 2026, and the app has passed 6 million users, about half of them Gen Z. Low minimums and fast uptake among younger users is the pattern expected to drive near-term growth. Where the opportunity is US, UK and EU: I couldn't find a major bank in the US, UK or EU that offers tokenized or vaulted digital gold in its app. Western retail investors still buy gold tokens mainly through crypto exchanges and brokers. The report's base case is that "banks in the remaining leading markets will follow suit," and the first bank to do so in each market will have the field to itself. EU: Revolut, the London-based banking app, withdrew precious-metals trading in more than 30 European markets and closed out customers' remaining positions on June 15, 2026. UK customers weren't affected, but that leaves a gap in Europe for a familiar app to fill. China: China changed its VAT rules on gold from November 1, 2025, raising the tax cost for banks that sell gold to customers. Two days later, ICBC, China's largest bank, paused new accounts, new plans and physical withdrawals for its gold accumulation product, which lets customers buy gold in small regular amounts. Demand for simple, small-amount gold saving is clearly there, and it will grow fastest where the rules behind it are stable. Utility Progress so far Yield, PAXGy: In September 2026, Paxos Labs launched PAXGy, a token that earns a return by lending PAXG's gold reserves to institutional borrowers in the gold-leasing market, where firms such as refiners and jewelers borrow physical gold and pay a fee for it. It's available on the crypto exchange OKX and on DeFi apps including Uniswap and Ether Fi. Yield is the biggest utility lever in the report, and this one comes from the issuer of the second-largest gold token. Yield, Pendle: On October 19, 2026, Pendle, a DeFi protocol that lets investors trade future yield separately from the asset that earns it, added PAXGy. Once a major yield market lists it, gold yield becomes something investors can trade, a sign the use case is deepening. Collateral, Arch Lending: Borrowing against gold lets holders raise cash without selling it. Since September 2026, Arch Lending, a lender that makes loans against crypto assets, has accepted PAXG and XAUT as collateral, lending up to 75% of their value at 7.25–9.25% APR. The tokens are held by Anchorage Digital Bank, a federally chartered crypto bank, and aren't lent out to anyone else while they secure the loan. A loan on set terms with a regulated custodian is the "borrow against holdings" lever the report describes. Collateral, Indonesia: Tring! users can pawn the gold they hold in the app, borrowing against it from Pegadaian, a regulated, state-owned lender. That gives retail customers in a leading market a way to borrow against app-held gold. Payments, Hong Kong: Since 2024, HSBC's Gold Token has let the bank's Hong Kong customers own fractions of physical gold in the HSBC app. On February 4, 2026, HSBC added transfers to other customers by mobile number. Sending gold person to person inside a bank app is a small step toward using gold for payments. Where the opportunity is Yield, credit risk: Because PAXGy's return comes from lending gold out, its exchange rate "may be adjusted downward" if a borrower defaults, and getting out means waiting in an approval-gated redemption queue. There's room for ways to grow a gold stack that don't put the gold itself at risk. Collateral, DeFi share: DeFi lending protocols let users deposit tokens as collateral and borrow other tokens against them. Only about $63M of PAXG and XAUT is posted as collateral on Aave and Morpho, the two largest DeFi lending protocols, against a combined market cap of about $4.9B. That's about 1% of supply, so about 99% of gold tokens are sitting idle, waiting for something useful to do. Collateral, Arch minimum: Arch's minimum loan is $250k. Like any loan against gold, the gold is sold off if its price falls far enough: Arch issues a margin call at 85% loan-to-value and liquidates at 90%. A retail version that doesn't put the gold at risk of liquidation is still to be built. Collateral, regulated institutions: I found no bank, clearing house or tri-party agent (the institutions that hold and manage collateral between trading parties) that accepts tokenized gold as collateral. The report's fourth sign of a breakout is utility spreading beyond crypto, tested by "whether regulated institutions adopt them," and that hasn't happened yet (although Pegadaian's pawning shows regulated collateral use for vaulted gold). The UK's FCA is now asking whether tokenized gold could serve as collateral in wholesale markets, so this may be the next door to open. Cost Progress so far PAXG fees: Paxos charges no storage or on-chain transfer fees on PAXG, and has waived its creation fee, charged when Paxos issues new tokens for dollars. Redemption costs 0.125% on the first $2M. With no holding fee, PAXG avoids the ongoing costs of ETFs and physical storage, the benchmarks the report uses. Small coins: The 1 oz American Gold Eagle, the US Mint's flagship bullion coin, sold at an average 1.87% premium in October 2026 (the markup buyers pay over the gold price), and as high as 4.39% a year earlier. Buying a token on Paxos's direct terms can cost less than that. Where the opportunity is ETF fees: GLDM, State Street's low-cost US gold ETF, charges 0.10% a year. Gold ETFs are funds that hold gold and trade on stock exchanges, and they're the cost benchmark digital gold has to beat. In Australia, Global X cut its gold ETF fee to 0.14% from September 1, 2026, a week after VanEck made the same cut. Gold tokens with no holding fee can already compete with that, and falling ETF fees keep pushing the whole market toward cheaper gold for savers. India: Digital gold in India carries 3% GST, the national goods and services tax, just like physical gold. Matching the tax treatment of the gold ETFs the Indian regulator points investors toward would close one of the biggest cost gaps in a market that buys digital gold more than 250 million times a month. China: China changed its VAT rules on gold from November 1, 2025. The change raised costs and disrupted bank gold products, which shows how much stable, predictable tax treatment is worth to growing demand. So how did we do? Rules for gold tokens are mostly commitments, roadmaps and conditional approvals so far, but they're moving in the right direction in Indonesia, the US, the UK and Hong Kong. The EU's rules are in place and waiting for their first authorized issuer, and India's industry has started writing its own. Redemption is opening up too, from 430 oz bars in London to 1 kg bars in Singapore and Hong Kong. Familiar apps drive adoption wherever they exist, as India's UPI and Indonesia's Tring! show, and Itaú became the first major bank outside Asia with a public gold token in its app. No large US, UK or EU bank has followed yet, which leaves the biggest Western markets open to whoever moves first. Yield and collateral products are live, mostly for crypto-native users and institutions. About 99% of gold-token supply isn't being used for anything yet, regulated institutions are only starting to look at tokenized gold as collateral, and payments are limited to transfers inside one bank's app. That's a lot of room to grow. With no holding fee, gold tokens can already beat ETFs and physical coins for larger, direct buyers. Bringing those costs to small buyers, and closing the tax gaps in India and China, are the next steps. Progress on digital gold stacking is real, and it's uneven in a way that shows where the opportunity is. It's strongest in Asia and among crypto-native and institutional users. The report's base case needs bank access and regulatory clarity in Western markets, where there's the most still to do. I think we're between the Bear and Base scenarios today, with a clear path to Base and the $700-billion addressable market for digital gold. I disagree with the report is on sequence. It lists four barriers but doesn't say which has to fall first, and because it ranks consumer protection as the biggest lever, it reads as though regulators need to move before users will. History suggests the opposite. ChatGPT reached 100 million users in two months, and within months EU lawmakers were adding rules for tools like it to the draft AI Act. Stablecoins grew to about $260 billion before the US passed the GENIUS Act in July 2025. Gold is already on the same path: India's digital gold boom pushed its sellers to write their own rules, and the FCA's tokenized gold consultation notes that these products have grown in recent years. Regulation tends to catch up with what people already use. I expect the biggest near-term growth to come from users rather than rulebooks. The opportunity is to build experiences people want to use that also protect their gold. Today, earning on gold usually means lending it out, as PAXGy does, which exposes holders to a borrower's default. I believe that the larger opportunity is for the dollars people already hold on-chain to earn gold. The stablecoins you already put to work in DeFi should earn gold rewards on top for building network health. Stacking digital gold shouldn't mean selling dollars or putting the gold you already own at risk, and the more people stack this way, the faster gold regulation will catch up. @xash @kemihu11 @alenribic @VinnyLingham

In case you missed it, @xash is live in open beta and anyone can now earn gold rewards on crypto. What you waiting for? Head on over to app.xash.com! LFG @alenribic @kemihu11

Why reward stablecoin users in gold? I joined @laurashin to discuss what we're building at @xash, how the rewards are funded today, and why stablecoin issuers could eventually pay for them. Thanks for having me, Laura!