Dubai Bets on Tokenized Gold as Bullion Demand Hits Record Highs
Dubai is building the regulatory and physical infrastructure to become a leading global marketplace for blockchain-based gold products, capitalizing on record investment demand and growing distrust of speculative crypto assets.
The emirate's push centers on a partnership between the Dubai Multi Commodities Centre (DMCC) and ComTech Gold, which issues the CGO token on the XDC (XinFin) blockchain network. Each CGO token represents one gram of physical gold stored in a DMCC-approved vault, with ownership verified through DMCC's Tradeflow system: a registry that originated as a trade finance platform for commodity warrants and now functions as an on-chain oracle layer connecting vault custody to token issuance, with records maintained on the blockchain.
The project has the backing of a formal regulatory framework that has taken shape over the past several years, with key milestones in 2025 and early 2026, giving Dubai a concrete institutional advantage over competing jurisdictions.
A Market Finding Its Footing
The timing reflects a broader surge in gold demand. Global investment demand reached 2,175 tonnes in 2025, a record high, as investors responded to geopolitical instability and a weaker US dollar.
Gold crossed $5,000 per ounce in January 2026, surpassing the level J.P. Morgan had projected prices could approach by year-end 2026.
Against that backdrop, the tokenized gold market expanded 177% in 2025, growing from roughly $1.6 billion to $4.4 billion in market capitalization. As of April 2026, total tokenized gold market cap has surpassed $5 billion.
The two largest products in the space are Tether Gold (XAUT), which holds approximately $2.54 billion in market cap and commanded roughly 75% of tokenized gold trading volume in Q4 2025, and PAX Gold (PAXG), which trades at roughly $4,790 per token with a circulating supply of about 493,640 tokens representing around 15 metric tonnes of gold.
On April 7, 2026, Binance added PAXG to its Proof-of-Reserves report for the first time, a transparency move that signals the sector is attracting institutional-grade scrutiny.
Total tokenized gold trading volume in 2025 reached $178 billion, with the fourth quarter alone accounting for more than $126 billion.
Louise Street, Senior Markets Analyst at the World Gold Council, described 2025 as a year when "investment demand stole the show as investors raced to access gold through all available routes," citing "economic and geopolitical instability" as the driving backdrop.
Regulation as the Real Product
Dubai's competitive edge is not just its physical gold infrastructure. VARA, the Virtual Assets Regulatory Authority established in 2022 and fully operational as of 2025, is the world's first independent regulator dedicated exclusively to virtual assets.
VASP licensing in Dubai reportedly takes three to six months, faster than most comparable jurisdictions.
In May 2025, VARA formally recognized Asset-Referenced Virtual Assets as a regulated category, which covers tokenized commodities including gold. The DIFC updated its crypto-token framework effective January 12, 2026, adding documented suitability assessment requirements for licensed firms.
At the federal level, Decision No. 4/R.M/2026 issued by the UAE Capital Markets Authority in February 2026 established eight licensed financial activities with minimum capital requirements ranging from AED 500,000 to AED 4 million.
According to industry data compiled by SoluLab, $30 billion in institutional capital, including significant interest from Gulf sovereign wealth funds, entered Dubai's digital asset ecosystem over the 18 months preceding 2026, a figure that reflects how seriously traditional finance is treating the regulatory clarity on offer.
What This Means for South Asia and Africa
For investors outside the US and Europe, Dubai's model carries specific relevance.
India and China together account for more than 50% of global bar and coin demand by volume. China recorded 28% year-over-year growth in bar and coin demand in 2025, while India posted 17% growth over the same period. The South Asian diaspora has a deep cultural and economic relationship with gold, and these figures underscore the appetite for accessible, low-friction gold investment products across both markets.
Indian retail and high-net-worth investors may be able to access Dubai-domiciled tokenized gold products under India's Liberalised Remittance Scheme, which allows up to $250,000 per person per year in foreign asset investment without special central bank approval, according to available guidance. Independent legal verification is advisable before relying on this pathway.
ComTech Gold's Shariah compliance adds another dimension. CGO is the first gold token to receive this designation, with a minimum entry point of just 0.5 grams, opening access to Pakistan, Bangladesh, and Muslim-majority Southeast Asian markets where Islamic finance principles govern a significant share of household savings. Conventional crypto products cannot reach these investors through the same channels.
Africa represents a separate but equally significant opportunity. Jesse Knutson, Head of Operations at BitFinex, noted in December 2025 that "emerging markets, which often lack deeply entrenched financial market infrastructure, are likely to embrace tokenized real-world assets before developed countries."
Sub-Saharan Africa has both significant gold production and populations accustomed to using gold as a store of value outside formal banking. The main barrier remains regulatory fragmentation across the continent, a challenge Dubai's single-regulator approach has sidestepped. Some regional progress is underway: Nigeria's Securities and Exchange Commission has issued tokenization guidelines, though continental harmonization remains a longer-term prospect.
The Broader RWA Context
Tokenized gold sits within a wider movement to put real-world assets on public blockchains. The on-chain real-world asset market grew approximately 380% between 2022 and March 2026, reaching $26.4 billion.
Tokenized US Treasuries account for the largest share at over $14 billion, but commodities, and gold in particular, drove approximately 25% of total RWA market growth in 2025. The scale of regional deal activity reinforces that momentum: in May 2025, MAG, MultiBank, and Mavryk announced a $3 billion RWA tokenization agreement, one of the largest transactions of its kind and a clear signal of the capital now moving into the space.
Analysts suggest that builders targeting the MENA commodity space should evaluate the XDC (XinFin) network, which ComTech Gold uses, as a lower-fee alternative to Ethereum for trade finance and commodity tokenization applications.
With gold prices holding above historic highs and Dubai's regulatory framework now substantially complete, the next phase is distribution. Gulf sovereign wealth funds have already moved capital into Dubai's digital asset ecosystem, and whether the next wave of growth is driven by South Asian diaspora investors or African fintech platforms will determine how broadly the sector's gains are shared.