Tokenized Commodities Market Set to Reach $100 Billion in a Decade

Tokenized commodities are scaling as issuers bring gold, silver, and crude oil onchain, with an industry executive projecting a market valuation exceeding $100 billion within a decade.

The Bottom Line

• Collateral Demand: Corporate treasuries and refiners are increasingly eyeing yield-generating tokenized commodities as productive balance-sheet collateral.
• Logistical Hurdles: While gold and silver leasing markets are relatively established, tokenizing physical crude oil introduces complex storage, verification, and volatility challenges.

Gold Lending Markets Expand to Onchain Platforms

The core proposition driving tokenized real-world assets is direct financial access. As co-founder Bhau Kotecha told CoinDesk in an interview, historical gold lending channels have relied on heavy capital scale and entrenched banking relationships that remain unavailable to smaller investors.

Kotecha identifies growing demand from individuals, family offices, and institutional players alike. Borrowing against PAXG stands out as a possible next step for market participants seeking liquidity without liquidating underlying bullion holdings.

At the same time, market structures carry distinct risks. Lending returns are not guaranteed, and borrower defaults could directly erode the underlying token value.

Industrial Silver Enters Institutional Leasing

Silver offers a secondary route into digital commodity financing. Theo’s thSLVR product passes income generated from institutional silver leases directly to token holders while maintaining continuous exposure to spot metal price movements.

Theo Chief Investment Officer Iggy Ioppe points to existing commodity owners and users as the primary growth drivers. Institutions seek productive collateral, refiners need efficient inventory financing, and corporate treasuries want assets that settle quickly.

Silver represents the natural second step after gold, Ioppe noted to CoinDesk, citing robust industrial demand and an established leasing market. Greater price volatility and a tighter supply of available physical metal, however, complicate the execution.

Looking ahead, Ioppe forecasts a tokenized commodities market worth tens of billions of dollars within five years, expanding past $100 billion within a decade. Over a 15-year horizon, he expects tokenization to become standard infrastructure for ordinary commodity settlement and financing.

Tokenized Asset	Primary Blockchain	Underlying Backing	Key Market Driver
PAXG (Gold)	Ethereum	Physical Gold Bullion	Gold lending and collateral access
thSLVR (Silver)	Various Networks	Institutional Silver Leases	Leasing income distribution
WTIC (Oil)	Ethereum, Solana	West Texas Intermediate Crude	Logistical scale and fast settlement

Crude Oil Tests Solana Scalability

Oil presents a considerably larger logistical challenge alongside a substantial market opportunity. Expanding West Texas Intermediate crude onchain requires verified physical inventory backing to maintain institutional trust.

EnSub expanded its WTIC token from Ethereum to Solana on Oct. 2. Each token represents exactly one barrel of WTI crude backed by verified physical inventory, according to the company’s public announcement.

As blockchain rails handle higher transaction volumes, the friction of traditional commodity settlement continues to draw institutional interest toward decentralized alternatives. Whether physical delivery mechanisms can scale seamlessly alongside token issuance remains the defining question for the next phase of market growth.

Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.