Op-ed: Tokenized gold merges ancient wealth traditions with blockchain innovation, bridging cultural values and modern finance in emerging markets.
Op-Ed by Mohammad Raafi Hossain
Gold has always been a cornerstone of wealth, a hedge against inflation, and a symbol of stability. For nations and individuals alike, especially in high-growth markets like India and Southeast Asia, its value goes far beyond economics—it’s cultural. These regions account for nearly 40% of global gold demand annually, driven by a deep-rooted trust in its reliability.
This trust stems from centuries of experience, where gold has consistently preserved wealth through wars, economic collapses, and political upheavals. In South Asian and Middle-Eastern countries particularly, gold plays a pivotal role in major life events, from marriages to business ventures, serving as both a status symbol and a practical financial tool.
At the same time, the rise of Bitcoin and other digital assets is challenging traditional financial systems. With Bitcoin hitting new highs and El Salvador leading the charge by adopting it as a national reserve, the world is taking notice. For countries like the U.S., Bitcoin’s decentralized nature offers a hedge against inflation and a pathway to financial innovation.
The appeal lies not just in its potential for value appreciation, but in its revolutionary technology. Blockchain, the underlying architecture of Bitcoin, introduces concepts like programmable money and trustless transactions—ideas that were impossible with traditional assets. This technological leap has sparked interest from major financial institutions, leading to unprecedented institutional adoption.
But not every nation is ready to embrace this digital frontier. In places like India as well as many Muslim-majority nations, gold continues to dominate both national reserves and personal wealth strategies. Central banks in these regions have doubled their gold reserves since 2008, and for good reason. Gold’s tangible nature offers security, cultural resonance, and a level of trust that Bitcoin’s volatility and regulatory uncertainty have yet to achieve.
This preference is deeply rooted in historical experience, where physical gold has repeatedly proven its worth during times of crisis. Moreover, gold's role in Islamic finance, where it meets important religious criteria for storing wealth, further cements its position in these regions. The metal's universal acceptance and lack of counterparty risk make it particularly attractive in areas where banking infrastructure might be less developed or trust in financial institutions is lower.
This doesn’t have to be an “either-or” scenario, though. Enter tokenized gold—a solution that bridges the stability of traditional assets with the liquidity and accessibility of blockchain innovation.
Why Tokenized Gold is the Bridge to the Future
Tokenized gold converts physical gold into digital tokens, making it fractionally accessible. A family in rural India could buy a fraction of gold for as little as $1—removing barriers like high upfront costs and the need for secure storage. This innovation democratizes gold ownership and provides financial security to millions previously excluded from traditional systems.
Moreover, tokenized gold unlocks the additional benefits of DeFi. Beyond ownership, it allows holders to earn yield or use their gold as collateral for loans—offering flexibility that traditional systems simply can’t match. Platforms like ORO, built on Fasset’s Ethereum L2 network, Own (In partnership with The Own Foundation), exemplify how yield-bearing gold tokens can seamlessly integrate into this modern financial landscape. For instance, a token holder can simultaneously maintain exposure to gold's value while earning gains through lending protocols—something impossible with physical gold sitting in a vault. This creates new opportunities for wealth building, particularly in emerging markets where traditional financial services might be limited or inaccessible. The 24/7 nature of DeFi platforms also means users can access their wealth and make transactions at any time, without being restricted by banking hours or geographical locations.
Bitcoin vs Gold: Finding the Right Fit
Bitcoin’s role as a national reserve asset may gain traction in some regions, but in high-growth markets, gold’s cultural and economic relevance is unmatched. Tokenized gold enhances this traditional asset with blockchain’s efficiency and transparency, offering a balanced solution for countries that value both innovation and heritage.
For example, a small business in the Philippines could use tokenized gold as collateral for a microloan, bypassing the inefficiencies of local banking systems. Similarly, governments in Muslim-majority nations could leverage tokenized gold reserves as a Sharia-compliant alternative to fiat currencies, ensuring financial stability while respecting cultural values.
The UAE’s Role in Driving Adoption
The UAE, with its strategic position as a global hub for gold and blockchain innovation, plays a pivotal role in making tokenized gold a reality. As a country at the nexus of high-growth markets in the Middle East, Africa and Asia, it is uniquely positioned to lead this charge—with a product that aligns with both economic needs and cultural priorities.
Tokenized gold is not just a technological evolution; it’s a transformative tool for financial inclusion. For nations and individuals navigating the complex balance between tradition and innovation, it offers a secure, inflation-resistant gateway to modern financial systems.
While Bitcoin may pave the way for digital asset adoption in some parts of the world, tokenized gold provides a solution tailored for high-growth markets—a bridge that respects cultural heritage while embracing the future. As blockchain and DeFi continue to evolve, the potential for tokenized gold to reshape financial ecosystems is no longer a question of “if,” but “when.”
This article contains links to third-party websites or other content for information purposes only (“Third-Party Sites”). The Third-Party Sites are not under the control of CoinMarketCap, and CoinMarketCap is not responsible for the content of any Third-Party Site, including without limitation any link contained in a Third-Party Site, or any changes or updates to a Third-Party Site. CoinMarketCap is providing these links to you only as a convenience, and the inclusion of any link does not imply endorsement, approval or recommendation by CoinMarketCap of the site or any association with its operators. This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice. The views and opinions expressed in this article are the author’s [company’s] own and do not necessarily reflect those of CoinMarketCap. CoinMarketCap is not responsible for the success or authenticity of any project, we aim to act as a neutral informational resource for end-users.
