Wintermute enables institutional OTC access to PAXG/XAUT block liquidity
crypto market maker Wintermute has launched institution-grade over-the-counter trading for tokenized gold products Pax Gold (PAXG) and Tether Gold (XAUT), as reported by FinanceFeeds. The service is designed for professional counterparties that require large, negotiated block trades in gold-backed tokens without moving public order books.
The arrangement targets execution quality for institutions by minimizing visible market impact and offering flexible settlement. Access is limited to KYC/AML-screened entities, aligning tokenized commodity trading with established compliance workflows.
Why it matters: reduced slippage, flexible settlement, KYC counterparties
OTC venues allow block execution via request-for-quote, reducing slippage relative to screen-based venues and enabling bilateral credit arrangements. Institutions can align settlement in fiat, stablecoins, or on-chain tokens while maintaining preferred custody setups.
Wintermute frames on-chain gold as the next phase of market-structure modernization, where institutional rails converge with tokenized real-world assets. “We’re watching gold undergo the same infrastructure evolution that turned foreign exchange into the world’s largest market … Gold is now following that playbook, and we expect the tokenized gold market to reach 15 billion in 2026 as institutional adoption accelerates,” said Evgeny Gaevoy, CEO of Wintermute.
Tokenized gold fundamentals strengthened through 2025, based on data from Cointelegraph: market cap expanded from roughly $1.6 billion to $4.4 billion, with about $178 billion of annual trading volume and $126 billion in Q4 alone. Those figures suggest rising depth and utility relative to legacy products.
Immediate impact: expanded liquidity across tokenized gold markets
Off-exchange block liquidity can complement centralized and decentralized venues by absorbing size away from public books. Better execution and bespoke settlement may tighten effective spreads and improve routing for institutions that already trade gold exposure.
At the time of this writing, tokenized gold’s market capitalization has surpassed $6 billion by mid-February 2026, according to Tekedia. Additional OTC connectivity could support depth across pairs such as PAXG and XAUT, subject to counterparty onboarding and credit availability.
Industry debate remains active on trust models for gold-backed tokens, according to Yahoo Finance. Proponents emphasize portability and 24/7 settlement, while critics stress custodial and issuer risk versus claims of being “on-chain” gold.
Mechanics, custody, and redemption for tokenized gold
How institutional OTC settlement works for PAXG and XAUT
In institutional OTC workflows, counterparties submit RFQs for block sizes in PAXG or XAUT, negotiate price bilaterally, and settle via pre-agreed rails. Settlement can involve fiat, stablecoins, or direct token delivery, depending on credit terms and operational preferences.
Access is restricted to KYC/AML-vetted institutions, aligning with standard onboarding, sanctions screening, and trade surveillance. Post-trade, operations include confirmations, reconciliations, and custody instructions that reflect the institution’s asset-segregation and audit requirements.
Risks versus gold ETFs and futures exposure
Tokenized gold introduces custodial and counterparty dependencies on the token sponsor, along with smart contract and chain risks. Regulatory treatment varies by jurisdiction, which can affect reporting, capital, and operational controls.
ETFs and futures centralize risk in regulated funds or clearinghouses with established margin and disclosure regimes. Tokenized gold prioritizes 24/7 transferability and programmability but requires confidence in issuer solvency, custody controls, and redemption procedures.
FAQ about tokenized gold
Is the $15 billion tokenized gold market projection by 2026 realistic, and what data supports or challenges it?
Momentum is strong, with 2025 volumes and a 2026 market cap above $6 billion. Achieving $15 billion likely depends on institutional rails, custody assurance, and regulatory clarity.
How do PAXG and XAUT compare on custody, redemption policies, fees, liquidity, and chain support?
Both are gold-backed with sponsor-defined custody and redemption. Fee schedules and chain support differ by issuer. Liquidity concentrates in major pairs, with terms set in official documentation.
| DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing. |
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