Tokenized gold is getting a burst of investor attention this year, tracking a surge in physical bullion demand as gold prices have repeatedly set fresh highs. But a new report from RedStone suggests that—despite improving market conditions—only a small portion of tokenized gold is actually being used in decentralized finance.

RedStone data points to a widening gap between market interest in tokenized bullion and its deployment in DeFi lending. In the first quarter, tokenized gold spot trading volume reached $90.7 billion as gold futures climbed above $5,600 per troy ounce. Yet just $63 million worth of tokenized gold—via Tether Gold (XAUT) and PAX Gold (PAXG)—is currently posted as collateral on Aave v3 and Morpho, according to RedStone. That collateral usage represents roughly 1.5% of the tokens’ combined $4.2 billion market capitalization.

Key takeaways

• Tokenized gold saw high activity in spot markets, with $90.7 billion in Q1 trading volume.
• Despite that liquidity, DeFi adoption remains thin: only about $63 million in XAUT and PAXG is used on Aave v3 and Morpho.
• RedStone highlights a real stress test: Aave processed its largest cluster of XAUT liquidations on March 23 without disruption during a sharp gold sell-off.
• Gold has been under pressure from expectations of higher US interest rates, which can reduce demand for non-yielding assets.

A resilient collateral asset, but with limited deployment

RedStone’s report frames tokenized gold as “battle-tested” in DeFi collateral, even while showing that the broader adoption story is still early. The core issue is not whether tokenized bullion can hold up during market volatility—it can—but whether enough capital is being placed into decentralized lending markets to make tokenized gold a meaningful on-chain primitive.

To ground that claim, RedStone points to Aave’s performance during a major sell-off. On March 23, Aave processed its largest cluster of XAUT liquidations without disruption as gold prices moved sharply lower. RedStone presents this as evidence that tokenized bullion can function reliably as DeFi collateral when markets turn fast.

That liquidation episode landed after gold dropped around 10% over the prior week—its worst weekly performance in more than four decades. Earlier coverage linked the sell-off to what JPMorgan precious metals strategist Greg Shearer called an “extremely brutal flush,” reflecting heightened risk-off behavior and fast repricing in commodity markets.

Why DeFi use is lagging: the market is there, collateral is not

RedStone’s numbers point to a mismatch between trading interest and productive DeFi usage. Tokenized gold spot volume suggests there is plenty of demand to buy, sell, and exchange tokenized bullion exposure. But the amount actually locked or committed to decentralized lending stays relatively small—about $63 million across Aave v3 and Morpho.

That matters because lending protocols are where tokenized real-world assets can translate from “tradable exposure” into “composable financial infrastructure.” If only a tiny fraction of the token supply is being used as collateral, DeFi’s ability to scale tokenized assets—especially during periods of high volatility—remains constrained by capital deployment rather than technical viability.

RedStone also situates the findings within a broader RWA expansion. Gold is one component of a market that includes private credit and tokenized US Treasurys paired with equity-related structures. In June, Token Terminal reported the sector had topped $43 billion in value, underlining that tokenization momentum is visible beyond gold alone.

Gold’s macro headwind could cut both ways

Even though the DeFi collateral test showed operational resilience, the report arrives during a period when gold itself has been under pressure. Since peaking in January, gold futures have fallen more than 26%. RedStone attributes the decline to expectations of higher US interest rates—an environment that tends to weigh on non-yielding assets like precious metals.

For tokenized gold, that matters for two reasons. First, falling prices can increase liquidation activity in lending protocols; the March 23 event shows that this process can occur without disruption. Second, if rates remain elevated, investor demand for bullion exposure may fluctuate, influencing both the spot trading volumes and the willingness of lenders/borrowers to engage with tokenized collateral strategies.

At the same time, RedStone’s reporting implies that DeFi adoption hasn’t accelerated in proportion to the broader “tokenized gold” trading narrative. If gold volatility persists, investors may demand more robust collateral mechanisms—but the current deployment levels suggest that the industry still has work to do to turn resilience into sustained utilization.

Centralized exchanges may be moving faster than on-chain lending

While RedStone’s focus is on DeFi collateral usage, the report’s broader framing highlights a contrast: centralized platforms are increasingly integrating tokenized assets as they try to bridge traditional finance and digital assets. According to a CoinGecko report referenced in the article, an emerging “crypto TradFi” market had grown to $6.6 billion as of June.

This difference in pace helps explain the adoption gap. Tokenized gold can be actively traded on centralized exchanges without necessarily being locked into on-chain lending. Until more liquidity and integrations flow directly into decentralized collateral ecosystems, tokenized real-world assets may remain more of a trading product than a primary DeFi building block.

As the tokenized RWA market expands—both on-chain and off-chain—readers should watch whether DeFi collateral usage of XAUT and PAXG rises meaningfully beyond current levels. The March 23 liquidation test suggests protocols can handle stress, but the next key question is whether capital continues to move from spot trading activity into sustained lending and other decentralized use cases.

South Korea has approved plans to establish a new 20 trillion won investment account within its sovereign wealth fund to finance artificial intelligence, data centers and other strategic industries while allowing domestic investments for the first time.

According to a South Korean government statement released Friday, the new account will be created under the Korea Investment Corporation (KIC), expanding the sovereign wealth fund’s mandate beyond overseas assets. The government said the account will begin with at least 20 trillion won in capital, funded through equity contributions from public institutions, including policy banks.

Unlike KIC’s existing portfolio, which primarily manages foreign assets, the new account will be permitted to invest inside South Korea. The government said the structure is intended to support industries considered strategically important while also generating long-term returns for future generations and strengthening national economic security, foreign exchange stability and financial markets.

The announcement also comes as South Korean equities remain under pressure. The Kospi index has fallen 34% during July, putting it on track for its worst monthly performance on record after investors sold shares of the country’s largest semiconductor companies over concerns surrounding the scale of AI-related capital spending.

South Korea expands KIC mandate to include domestic assets

Government officials said the investment account is designed to respond to rising international interest in South Korea’s technology sector, particularly projects linked to artificial intelligence infrastructure.

According to the government, a domestic anchor investor will help attract capital from foreign sovereign wealth funds and global asset managers seeking exposure to Korean technology investments. Although officials did not directly connect the initiative to the recent stock market decline, the announcement follows several government measures introduced in recent weeks to stabilize financial markets.

The government also stressed that the account’s investment decisions will remain independent despite its public policy objectives. It said the new vehicle will operate separately from KIC’s existing foreign exchange reserve portfolio, preserving the institution’s current investment framework.

To enable the new structure, the government plans to submit amendments to the Korea Investment Corporation Act to the National Assembly in August. Fund operations are expected to begin in 2027 once the legislative process is completed.

Korea Investment Corporation managed approximately $232 billion in assets at the end of 2025. The sovereign wealth fund oversees money entrusted by the government, the Bank of Korea and other public institutions as part of the country’s foreign reserve management program.

AI investment strategy builds on startup funding plans

The latest initiative adds another layer to South Korea’s technology investment strategy after the government recently stepped up efforts to attract overseas venture capital into domestic startups.

As previously reported by crypto.news, President Lee Jae-myung met representatives from six Silicon Valley venture capital firms, including Sequoia Capital, Andreessen Horowitz, Khosla Ventures, Lightspeed Venture Partners, General Catalyst and New Enterprise Associates, encouraging them to increase investments in Korean startups.

The National Pension Service also signed separate memorandums of understanding with the six firms to establish long-term investment cooperation covering investment opportunities, market information sharing and stronger links between Korea’s startup ecosystem and international venture capital networks.

Asiae reported that the government is simultaneously preparing a proposed National Growth Fund valued at 200 trillion won to finance industries such as artificial intelligence and semiconductors. The publication said policymakers expect public funding, private investment and overseas capital to enter the domestic technology sector together if the initiatives proceed as planned.

While welcoming stronger international participation, Asiae also argued that South Korea will need policies that encourage successful startups to continue expanding domestically. The newspaper pointed to stock option rules, visa policies for foreign specialists, merger and acquisition activity, commercialization of university research and administrative procedures as areas that could influence long-term investment decisions.

Digital asset policies continue alongside technology funding

The sovereign investment plan has emerged alongside several technology-related policy initiatives that South Korean authorities have been advancing during recent months.

Earlier this week, a policy report published by Hashed Open Research and the Solana Policy Institute recommended introducing interim licensing guidance for stablecoins before lawmakers complete the country’s Digital Asset Basic Act. The report proposed a phased regulatory framework covering stablecoin issuance, payment services and foreign-issued tokens while comprehensive legislation remains under discussion.

The report also summarized views presented during a June policy symposium, including ongoing discussions over whether banks should retain majority ownership of stablecoin issuers while fintech companies manage operations. Those recommendations remain advisory and have not been adopted into law.

Separately, the Financial Services Commission has said it intends to consolidate ten pending digital asset proposals into a government-backed Digital Asset Basic Act covering stablecoin issuance, exchange conduct, disclosures, internal controls and operational resilience, although no implementation timetable has been announced.

Cryptocurrency exchange Coinbase reported its Q2 earnings, posting $1.2 billion in revenue and missing Wall Street estimates on sales and profits for a third straight time.

The exchange blamed low spot trading volumes and low volatility for missing earnings estimates. Coinbase lost $1.36 per share, significantly higher than Wall Street’s estimate of a loss between 17 cents and 44 cents, as transaction, subscription, and stablecoin revenue came in lower than expectations.

Coinbase Posts $1.2 Billion In Revenue

The mixed Q2 earnings come as weak trading activity dragged expected results lower despite cornering a record share of the cryptocurrency market. Coinbase reported $1.2 billion in net revenue for Q2, a 19% decline from the previous year.

The GAAP net loss of $359 million was significantly higher than market expectations of a $122 million loss. Coinbase’s subscription revenue, transaction revenue, services revenue, and adjusted EBITDA also fell short of expectations.

Transaction revenue was also lower at $599 million against the expected $636 million. Subscription services revenue clocked in at $555 million, narrowly missing the estimated $590 million.

Coinbase reported $292 million in stablecoin revenue, a $17 million decline from Q2 2025, and lower than StreetAccount’s estimate of $327.2 million. The company’s shares fell over 5% during after-hours trading following the earnings report.

Weak Spot Trading Activity Dampens Q2

Despite the lower numbers, Coinbase’s share of the cryptocurrency market jumped to an all-time high of 10.3%, substantially higher than the 9.1% reported in Q1. The increase in market share comes despite a struggling crypto market and weak trading activity.

Coinbase has attributed the lower-than-expected results to weak institutional and retail trading activity. Spot trading volume has dropped 25% quarter-over-quarter, while cryptocurrency prices have remained low thanks to geopolitical tensions and policy headwinds.

Brian Armstrong Bullish On Coinbase

Coinbase is positioning itself as an “Everything Exchange” as it expands its presence into derivatives, prediction markets, payments, and tokenized assets. CEO Brian Armstrong highlighted the exchange’s record market share, adding that it could operate in any market, stating,

“Coinbase is no longer a bet just on the price of bitcoin. All of financial services are getting updated by crypto, whether that’s trading or payments or lending.”

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Crypto adoption in Canada is rising fast, according to new research from the Ontario Securities Commission (OSC). The regulator’s latest survey suggests that the share of Canadians who own cryptocurrency has climbed to 25% in 2026—up sharply from 10% in 2023—while awareness has also increased.

In findings released Tuesday, the OSC reported that 59% of surveyed adults said they are aware of crypto assets, and 25% reported holding them. The survey polled 2,360 Canadians aged 18 and over between December 2025 and January 2026, offering a snapshot of how quickly retail interest has expanded in recent years.

Key takeaways

• OSC survey data indicates crypto ownership reached 25% in 2026, versus 10% in 2023.
• Awareness among Canadian adults rose to 59%, up from levels reported in earlier OSC research.
• Roughly half of crypto owners said they check whether a platform is registered before using it.
• Many owners still appear to misunderstand core protections such as regulation, insurance coverage, and transaction capabilities.
• Federal policy discussions—such as proposed restrictions on crypto political donations and digital asset ATMs—continue in parallel with growing retail participation.

OSC survey shows rapid rise in ownership and awareness

The OSC’s survey points to a significant shift in how mainstream crypto has become among Canadian adults. While crypto awareness has increased, the more notable change is ownership: 25% of respondents reported holding crypto assets, a jump compared with the 10% ownership level reported in 2023.

OSC framed the results as evidence that Canadians are “participating” in crypto markets more than they were only a few years ago. In its release, the regulator highlighted the value of monitoring “emerging trends and behaviors” to refine how it approaches oversight.

Knowledge improving—but investor understanding of protections still lagging

Beyond adoption, the OSC also examined how informed owners appear to be. The findings suggest some improvement in basic due diligence: about 50% of crypto owners said they check whether a platform is registered before using it.

However, the OSC noted that the survey also reflected “misunderstanding” around multiple areas that matter for consumer protection. The regulator said many respondents had incomplete or incorrect beliefs related to regulation, insurance protections, and transaction capabilities.

For investors, this matters because the practical safety of an investment often depends not just on whether a platform exists, but on what protections apply when things go wrong—such as custody issues, service failures, or disputes about transactions. The OSC’s takeaway implies that higher ownership does not automatically translate into stronger investor literacy.

Growing retail participation intersects with Ottawa’s policy push

Canada’s shift toward wider crypto ownership is occurring as lawmakers debate how crypto should be regulated and where restrictions should apply. Earlier coverage from Cointelegraph highlighted two federal moves that align with the OSC’s consumer-protection themes.

In April, the federal government advanced a bill that could ban the use of crypto for political donations. In the same period, Ottawa also proposed banning digital asset ATMs, citing concerns about fraud.

These initiatives reflect a broader tension that regulators often face as adoption rises: extending access while limiting pathways that could be exploited for wrongdoing. If more consumers are entering the space, policymakers may feel stronger pressure to tighten safeguards—particularly around rails that can be used anonymously or with limited oversight, such as certain payment or cash-conversion channels.

What to watch next as regulation meets expanding demand

The OSC’s survey underscores that crypto is no longer a niche activity in Canada. With one in four surveyed adults reporting ownership and more than half expressing awareness, future regulatory decisions will increasingly affect a mainstream retail population rather than a small enthusiast base.

At the same time, the OSC’s warning about gaps in understanding suggests that education and clearer consumer-facing disclosures may be just as important as rulemaking. Investors should watch whether regulators emphasize registration checks, platform disclosure standards, and specific protections related to custody and transactional processes—and whether federal proposals tied to donations and ATMs move forward.

As the next round of research or consultations approaches, the key question will be whether Canada’s regulatory response keeps pace with the pace of adoption—and whether consumers gain not only access, but also the ability to evaluate risk and protections with confidence.

Bitcoin traded near $63,900 on Friday, roughly flat, as the Bank of Japan left its benchmark rate at 1% and Governor Kazuo Ueda’s attempt to sound hawkish landed softly with markets.

The yen gave back its move during his press conference, and the dollar-yen pair returned to where it started, since traders had already priced a high chance of an October hike.

Ueda said inflation should rise above 2% later this fiscal year and pointed to AI demand and the weak yen as forces pushing prices higher, the same two threads that have shaped crypto’s macro backdrop all month.

A soft yen has fed the carry trade that sends money into risk assets, and the AI capital cycle is the trade bitcoin has tracked closely.

The broader market was quiet. Ether held near $1,885, while BNB extended its run as the standout large token, up 3.5% on the day and 4.4% on the week to around $591, per CoinDesk data.

Senate negotiators have reportedly proposed revised ethics language for the CLARITY Act that would let state authorities enforce restrictions on federal officials’ crypto activities as bipartisan talks continue before the August recess.

According to Punchbowl News, Republican Sen. Thom Tillis and Democratic Sen. Ruben Gallego have submitted a counterproposal to the White House that changes how the ethics provisions in the Digital Asset Market Clarity (CLARITY) Act would be enforced. 

Instead of giving the U.S. Attorney General sole enforcement authority, the proposal would allow state authorities to enforce a ban on federal officials issuing or sponsoring digital tokens.

The reported revision addresses one of the main concerns raised by Senate Democrats during negotiations over the crypto market structure bill. 

Ethics enforcement has remained a sticking point

Debate over ethics rules has continued for weeks despite earlier progress between the White House and Senate Republicans.

The White House said on July 22 that it had accepted what it described as the most extensive federal ethics restrictions ever proposed after negotiations with Republican Sens. Cynthia Lummis and Bernie Moreno. At the time, however, the administration did not disclose the final wording or explain how the provisions would be enforced.

Several Democrats argued that leaving enforcement solely to the Department of Justice would not provide enough independent oversight because the department falls under the executive branch. Barron’s previously reported that some lawmakers wanted state attorneys general to share enforcement authority, a position that closely matches the latest reported proposal.

Earlier in the negotiations, Patrick Witt, executive director of the President’s Council of Advisors for Digital Assets, told CoinDesk that the administration supported ethics rules applying across the federal government but opposed language targeting any single official or family.

CLARITY Act still needs Democratic votes

Gallego has repeatedly said the legislation requires stronger ethics safeguards before it can secure Democratic backing.

The Arizona senator previously said protections covering ethics, consumer protection, illicit finance, conflicts of interest and market integrity “must be strengthened,” adding that he would continue working with Republicans to get the bill across the finish line.

Many Senate Democrats have also warned they will not support the CLARITY Act if they believe it allows President Donald Trump to retain influence over an industry his administration would regulate. Their concerns have focused on Trump’s memecoin project and his family’s involvement with World Liberty Financial.

Republicans currently hold an effective 52-47 majority in the Senate because Sen. Mitch McConnell remains absent for medical reasons. Even so, the party still needs Democratic support to reach the 60 votes required to advance most legislation.

White House faces pressure before the August recess

Pressure has increased as lawmakers approach the Senate’s August recess with limited time remaining to move the legislation.

Treasury Secretary Scott Bessent called on senators earlier this week to hold a vote on the CLARITY Act before leaving Washington, arguing that lawmakers should publicly state where they stand on the crypto market structure bill.

Bessent also defended the Blockchain Regulatory Certainty Act, saying it would codify longstanding Treasury policy on non-custodial software developers rather than weaken anti-money laundering enforcement. Law enforcement groups, including the National Fraternal Order of Police and the Major Cities Chiefs Association, later backed the revised language after earlier raising concerns.

The House approved its version of the CLARITY Act in July 2025 with bipartisan support, but Senate negotiators must still finalize the ethics package and secure enough Democratic votes before the legislation can move forward.

Bhutan’s Gelephu Mindfulness City appointed Canadian digital-asset manager 3iQ on July 30 to manage a dedicated mandate backed by an undisclosed portion of its Bitcoin treasury. 

The agreement advances a national pledge to allocate up to 10,000 BTC to the special administrative region’s long-term development.

The parties said 3iQ will also establish a long-term presence in Gelephu, invest in Bhutanese talent and transfer investment-management knowledge. They did not disclose how much Bitcoin entered the mandate or when active management would begin.

3iQ mandate leaves key commercial terms undisclosed

The company release provides no mandate value, management fee, custody provider or investment benchmark. It also does not say whether 3iQ may lend Bitcoin, use derivatives, post collateral or pursue yield strategies. Those omissions prevent an independent assessment of the mandate’s risk limits or expected returns.

3iQ chief executive Pascal St-Jean said the firm would put Bhutan’s capital to work “responsibly, transparently and for the long term.” That statement describes the company’s intended approach, not a verified performance outcome. GMC board director Jigdrel Singay called 3iQ a founding institutional partner for the city’s planned fund ecosystem.

The agreement connects GMC with Coincheck Group, whose shares trade on Nasdaq. Coincheck disclosed that it completed the acquisition of a 99.8% beneficial interest in 3iQ on February 28. St-Jean became Coincheck Group’s chief executive on April 1 while retaining his role at 3iQ.

Bhutan’s Bitcoin pledge enters its deployment phase

Bhutan announced in December 2025 that up to 10,000 BTC from national holdings would support Gelephu’s development. GMC says the reserve was built by converting surplus hydroelectric power into Bitcoin and is intended to create jobs, develop technical skills and strengthen long-term financial resilience.

The official pledge says the Bitcoin is being put to work for national development rather than held for short-term speculation. The 3iQ appointment is the clearest disclosed step so far toward outside professional management, although the amount assigned to the firm remains unknown.

However, Bhutan has also explored collateralization, treasury management and risk-managed yield as possible tools for the broader pledge. GMC rejected claims that earlier transfers from Bhutan-linked wallets represented sales from Bitcoin committed to the city’s strategic reserves.

Gelephu’s rules require clarity on 3iQ’s local role

Gelephu’s Financial Services Office regulates traditional finance and virtual-asset activity inside the special administrative region. Its rules require firms carrying out regulated services, including asset management, to obtain a financial services licence before beginning local operations.

The regulator’s public directory did not list an entity named 3iQ on July 31. That absence does not prove that the mandate requires a separate GMC licence or that no application is pending. The partnership announcement did not identify a licensed local entity or explain the regulatory structure under which 3iQ will operate.

The directory currently includes seven approved firms, with 8020 Finance authorized to manage assets from July 23. GMC has also introduced an accelerated pathway for firms already supervised in recognized foreign financial centers, but local regulators retain responsibility for final approval.

Further milestones will define the treasury strategy

3iQ and GMC said this agreement is the first of several milestones they plan to announce over the coming months. Expected steps include building a local team, establishing operations and developing an institutional fund ecosystem, but the parties provided no formal timetable.

Future disclosures will need to show the Bitcoin amount under management, custody controls, permitted trading strategies and reporting standards. Any use of leverage, lending or collateral would also require clear risk limits because losses or counterparty failures could affect assets committed to national development.

Until those details are released, the agreement confirms a manager and a strategic direction rather than a fully disclosed investment program. Its progress will be measured by regulatory approvals, operational launches and transparent reporting on how Bhutan’s Bitcoin supports Gelephu’s development.