The debate between Gold ETF and tokenized Gold has heated up further as experts and investors speculate on which asset could bring better returns in this market cycle. The assets both provide access to gold but differ in their operational approaches, as capital looks to shift more into the tokenization sector.
Tokenized Gold vs Gold ETF: Where is Capital Flowing?
Tokenized gold markets witnessed explosive growth in the last year. In 2025, its market cap increased its net value by almost $2.8 billion. Its market cap rose from $1.6 billion to $4.4 billion. Tether Gold especially grew by 6% to $3.7 billion according to DefiLlama data.
This implies that the market absorbed almost a quarter of the net RWA increase in the last year. Its net inflows are also greater than the net inflows in tokenized stocks, corporate bonds, and non-US treasuries.
The number of tokenized gold holders increased by more than 115,000 in the last year. Its increase was 14 times faster than in 2024. Compared to the other major RWA markets, the tokenized gold market increased its holders by more than the tokenized US treasuries and other tokenized bonds.
Meanwhile, large gold ETFs reported substantial asset flows, which doubled their asset size. However, even in this context, tokenized gold has turned out to be a standout.
Tokenized gold grew 2.6 times faster than the physical asset. This outperformed most of the top 7 spot ETFs. Among the major ETFs, only iShares Gold Trust Micro (IAUM) reported a growth of more than 300% in asset size this year.
Trading Volume Shows Where Adoption Is Accelerating
Trading volumes of gold-related assets witnessed a dramatic acceleration during 2025, with volumes increasing quarter by quarter. By Q4, the trading volumes of the tokenized asset surpassed an impressive figure of over $126 billion.
To put it into perspective, the trading volumes of tokenized gold during Q4 were slightly higher than those of five major ETFs. However, there is one ETF that stands out from the rest , SPDR Gold Shares, or GLD, with its massive trading volumes of $375 billion during Q4.
In comparison with gold ETFs, tokenized gold would rank preciousbymetals’g volumes, ahead of all the precious metal’s ETFs except GLD. Trading volume in gold tokens in 2025 grew by more than 1,550% compared to 2024, a rate that was almost ten times faster compared to that of the largest ETFs, which registered a growth rate of between 100% to 150%.
