Tokenized Commodities Expand Beyond Gold Into Silver Lending and Oil Markets
Commodity tokenization is no longer just about gold
Executives at three crypto companies — Paxos Labs, Theo, and Energy Substantiation (EnSub) — say the tokenized commodities market is moving beyond gold into silver lending and oil tokenization. The idea is to use blockchain-based tokens not just to track commodity prices, but to create new financing options for metals and energy that were previously limited to large institutions.
Tokenized commodities are digital tokens on a blockchain (a public digital ledger) that represent ownership of or exposure to physical assets like gold, silver, and oil.
Key numbers and products
- The tokenized commodities market reached $5.55 billion in market capitalization at the end of March 2026, up from $1.43 billion at the start of 2025, according to CoinGecko.
- Gold-backed tokens from Paxos and Tether made up nearly 90% of that growth.
- Paxos Labs launched PAXGy, a token backed by PAX Gold with reserves deployed to institutional borrowers. As lending returns are paid back, each PAXGy token is designed to become redeemable for more PAXG.
- Theo offers thSLVR, which passes income from institutional silver leases to holders while maintaining exposure to silver's price.
- EnSub built the WTIC token for physically backed oil and is developing tokens for natural gas and Brent crude.
What Paxos Labs says about access
Paxos Labs co-founder Bhau Kotecha told CoinDesk that the main value proposition is access. Historically, gold lending required scale and relationships that most individual investors did not have. Kotecha sees demand from individuals, family offices, and institutions, with the possibility of borrowing against PAXGy as a next step. He also noted that lending returns are not guaranteed, and borrower defaults could erode the token's value.
Silver as the next step, oil as a bigger challenge
Theo's chief investment officer Iggy Ioppe called silver "the natural second" after gold, citing strong industrial demand and an existing leasing market. He sees growth coming from institutions that want productive collateral, refiners financing inventory, and corporate treasuries that need assets settling quickly. However, he noted that silver is more volatile than gold and available supply is tighter.
Oil tokenization presents a larger logistical challenge. EnSub is working on it alongside its existing oil product and has plans for natural gas and Brent crude tokens.
Ioppe forecasts a tokenized commodities market worth tens of billions of dollars within five years and more than $100 billion within a decade. He expects tokenization to become part of ordinary commodity settlement and financing within 15 years. These are his personal estimates, not confirmed targets.
What remains uncertain
The executives acknowledge that custody (secure storage of physical assets), logistics, and borrower risk are real obstacles. The gold lending model depends on borrowers repaying in gold ounces, and defaults could reduce token value. Oil tokenization involves more complex physical handling than metals. The source material does not confirm whether EnSub's gas and Brent token projects have launched or are still in development.
Why this matters
If tokenized commodities expand beyond gold price exposure into lending and energy markets, it could make commodity financing available to a wider range of participants. The source material indicates that many of these markets were previously restricted to large institutions. The practical benefits depend on whether the companies can overcome custody, logistics, and credit risks they themselves identified.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.