The tokenized commodities market has experienced explosive growth, surging 53% in less than six weeks to surpass $6.1 billion in total value, making it the fastest-growing sector within the real-world asset (RWA) tokenization landscape. This represents an addition of approximately $2 billion since the start of 2026, when the market was valued at just over $4 billion.
The market is overwhelmingly dominated by two gold-backed tokens. Tether Gold (XAUt) leads with a market capitalization of $3.6 billion after a 51.6% increase over the past month. PAX Gold (PAXG) from Paxos follows with a $2.3 billion market cap, having grown 33.2% in the same period. Together, these two assets account for over 95% of the entire tokenized commodities market.
This 360% year-over-year growth significantly outpaces other tokenized asset classes. Tokenized stocks grew 42% to $538 million, while the tokenized funds market, though larger at $17.2 billion, saw only a 3.6% increase.
The surge coincides with a historic rally in physical gold prices, which have increased more than 80% over the past year. Gold hit an all-time high of $5,600 per ounce on January 29, experienced a pullback to around $4,700, and was trading near $5,050 at the time of reporting. This performance starkly contrasts with Bitcoin, which fell 52.4% from its early October 2025 high of $126,080 to approximately $60,000 before a partial recovery to $69,050.
Tether is actively expanding its tokenized gold footprint, announcing on Thursday a $150 million strategic investment in the precious metals platform Gold.com. The move aims to broaden mainstream access to tokenized gold products. Tether plans to integrate its XAUt token into Gold.com's platform and is exploring options for customers to purchase physical gold using its USDT stablecoin.
Market analysts note a divergence in investor behavior, with capital flowing into tokenized gold as a perceived safe-haven asset during crypto market weakness. The crypto market crash on October 10, 2025, which triggered $19 billion in liquidations, reinforced this defensive positioning. Strike CEO Jack Mallers commented that Bitcoin is still being treated "like a software stock," while asset manager Grayscale noted the "digital gold" narrative for Bitcoin is being tested as its price action increasingly resembles a high-risk growth asset rather than a monetary hedge like physical gold.
