Wintermute launches OTC for PAXG

Institutional demand for blockchain-based commodities is accelerating, and Wintermute is moving to capture this momentum with a deeper focus on tokenized gold.

Wintermute launches institutional OTC trading for gold-backed tokens

Crypto market maker Wintermute has launched institutional over-the-counter trading for Pax Gold (PAXG) and Tether Gold (XAUT), the two largest gold-backed tokens by market capitalization. The firm announced the expansion on Monday, positioning the desk for professional investors seeking blockchain-based exposure to physical gold.

The new OTC service will provide algorithmically optimized spot execution in PAXG and XAUT, tailored for institutional clients. Moreover, Wintermute will act as a liquidity provider across multiple venues, aiming to tighten spreads and improve price discovery for large-size orders.

The initiative arrives as tokenized gold trading volume surges across digital asset markets. In the fourth quarter of 2025, trading volumes in on-chain gold products reached $126 billion, surpassing the combined activity of five major gold exchange-traded funds over the same period.

On-chain gold market outpaces traditional ETFs

The broader on-chain gold market has expanded rapidly alongside this volume spike. Over the past three months, the market capitalization of tokenized gold products climbed more than 80%, rising from $2.99 billion to $5.4 billion. That said, the segment still represents a small fraction of the global physical gold market.

Investors appear increasingly attracted to 24/7 liquidity and near-instant settlement compared with traditional gold ETFs that only trade during market hours. However, regulatory frameworks for tokenized commodities continue to evolve, and institutional participants remain focused on custody standards and counterparty risk.

Wintermute chief executive Evgeny Gaevoy argued that gold is now following the same infrastructure evolution seen in foreign exchange markets over the past two decades. According to the firm, the tokenized gold market could reach $15 billion by 2026, implying roughly a 2.8x increase from current capitalization levels.

What tokenized gold offers institutional investors

Tokenized gold represents digital tokens issued on a blockchain that are backed by physical gold reserves held with custodians. Each token typically corresponds to a fractional claim on a specific quantity of gold, allowing traders to move exposure across venues and wallets with minimal friction.

Unlike conventional ETFs, which settle through legacy market infrastructure, these assets settle on-chain. Moreover, they enable 24/7 trading across centralized exchanges, OTC desks, and decentralized platforms, which can be attractive for funds engaged in cross-asset arbitrage, collateral optimization, or intraday risk management.

Wintermute’s institutional desk will support PAXG and XAUT trading against multiple currencies and assets, including USDT, USDC, major fiat currencies, and leading cryptocurrencies. The firm says the service is designed to facilitate real-time hedging, improve collateral mobility, and integrate more seamlessly with digital asset treasury operations.

Macro backdrop: gold near record highs and de-dollarization themes

Wintermute reports that client interest has risen as spot gold prices trade near all-time highs. Current macro conditions feature persistent geopolitical uncertainty, elevated inflation concerns, and ongoing debates around de-dollarization. Together, these factors have supported demand for gold-backed digital instruments among hedge funds, trading firms, and sophisticated family offices.

Moreover, some institutions are exploring tokenized commodities as an alternative collateral layer for derivatives and lending markets. However, adoption still depends on the depth of secondary market liquidity, legal clarity on ownership rights, and the robustness of the underlying custody and audit processes.

Growth of tokenized real-world assets

The rapid rise of on-chain gold is part of a larger expansion in tokenized real-world assets (RWAs). Tokenized public-market RWAs tripled in 2025 to approximately $16.7 billion, according to industry data. This acceleration reflects growing institutional comfort with using blockchains to represent traditional securities and commodities.

Research from ARK Invest suggests tokenized assets could exceed $11 trillion by 2030, covering everything from government bonds to alternative credit. Meanwhile, Standard Chartered forecasts tokenized RWAs reaching $2 trillion by 2028. BlackRock executives have similarly described tokenization as a structural shift for global capital markets rather than a short-term trend.

The commodities segment has already seen notable experiments. Earlier this month, Billiton Diamond and Ctrl Alt tokenized over $280 million of certified polished diamonds in the UAE, bringing a traditionally opaque market onto blockchain rails. Silver has also drawn interest as a candidate for tokenization, with the broader silver market boasting an estimated capitalization of $4.21 trillion.

Institutional tokenization momentum and Wintermute’s role

BlackRock’s BUIDL fund has become one of the flagship institutional tokenization projects, with assets under management now above $2 billion. The asset manager recently disclosed plans to list its tokenized market fund on Uniswap, enabling qualified counterparties to trade the token directly via a decentralized exchange.

Against this backdrop, Wintermute aims to position itself as a core liquidity provider in the emerging market for tokenized commodities. Moreover, by offering institutional OTC execution in PAXG and XAUT against stablecoins, fiat, and major cryptocurrencies, the firm is betting that on-chain settlement will become a standard route for gaining and hedging gold exposure.

Overall, the firm’s launch underscores how institutional infrastructure for digital assets is converging with traditional commodity markets. If current growth trajectories hold, both tokenized gold and broader RWA markets could represent a significant slice of global capital flows by the end of this decade.