Former Binance CEO Changpeng “CZ” Zhao has dismissed tokenized gold, calling it a “trust me bro” asset, arguing that it fundamentally violates the decentralized principles of cryptocurrency.
In a post on X on October 23, CZ stated that tokenized gold is not equivalent to “on-chain gold,” as it represents an IOU or a claim on a physical asset, not direct, decentralized ownership like Bitcoin.
“It’s tokenizing that you trust some third party will give you gold at some later date, even after their management changes, maybe decades later, during a war, etc,” Zhao wrote, criticizing the dependence on centralized custodians to hold and redeem the physical gold backing the tokens.
Schiff Plans Tokenized Gold Rival to Bitcoin
CZ’s comments come just as prominent gold advocate and long-time Bitcoin critic Peter Schiff revealed plans to launch a new tokenized gold product.
In a recent interview, Schiff claimed his product would allow users to “buy gold” on an app, stored in a vault, enabling instant transfers of ownership and redemption for physical gold—claiming it would rival Bitcoin as a form of payment.
“The one thing that makes sense to put on a blockchain is gold… cause it will work and it will do all the things that Bitcoin promises but can never do,” Schiff stated.
Bitcoin vs. Gold Market Action
The debate highlights the continued clash between traditional and digital stores of value.
Gold recently suffered one of its steepest market crashes in years, with its market cap falling by an amount exceeding the total value of Bitcoin’s market cap. Gold currently boasts a market value of approximately $28.5 to $30 trillion, making it the world’s largest asset.
Bitcoin ($BTC), in contrast, has rallied following gold’s downturn, climbing back above the $109,000 threshold and maintaining a market capitalization of roughly $2.2 trillion, ranking it eighth globally.
Earlier this week, CZ reiterated his long-term prediction that Bitcoin will one day “flip” gold, although he acknowledges the vast market gap that remains. Analysts note that Bitcoin would need to reach an approximate valuation of $1.5 million per BTC to surpass gold’s market cap.
