MKS PAMP's crypto-gold token DGLD returns to the market after six years

Swiss metals group MKS PAMP is bringing back DGLD, its gold-backed crypto token, after pausing it for six years.

The company told Cryptopolitan that rising demand for gold among crypto traders and big funds pushed it to restart the project.

MKS PAMP runs refineries, trading desks, and retail gold operations across several regions, and it said the new market conditions make the relaunch necessary.

Executives said interest came from people who already made their money in crypto and now want gold they can use. James Emmett, the chief executive officer of MKS PAMP, said these investors do not want metal “sitting in a safe.” James said they want to “utilize it in one form or another” and want to “stake it or leverage it.”

The company said this is why it decided to revive the token. The company added that institutional funds also asked for easier ways to own gold that can move fast in digital markets.

MKS PAMP rebuilds DGLD with new trading support

The company launched DGLD in 2019 with CoinShares International, but James said the timing was “too early,” and the token soon went quiet. MKS PAMP said the new version will work differently. The company’s own trading arm will buy tokens and provide liquidity so that trading activity does not dry up again.

MKS PAMP said this change is meant to avoid the problems that slowed the token after 2019.

For the relaunch, MKS PAMP bought Gold Token SA, a company that had been working on digital bullion before the acquisition. Kurt Hemeker, the chief executive officer of Gold Token SA, said two forces are pushing demand: the rise in gold prices and the growth of real-world-asset tokenization.

Kurt described the moment as the “perfect storm.” In the statement shared with Cryptopolitan, he said investors want gold in digital form that works “24/7 with instant settlement” and can be traded on open markets without delay.

The company said new DGLD tokens will only be sold to accredited institutions. Those buyers can then send the tokens to crypto exchanges, where the broader market can trade them.

MKS PAMP added that each token can be redeemed for physical gold, starting at one gram. The company said it will not charge fees for issuing or redeeming the tokens at the start, even though most gold-backed tokens require users to pay both when buying and when cashing out to cover vaulting costs.

Tokenized gold competes with ETF inflows as demand grows

MKS PAMP said the idea of tokenizing gold has gained traction because ownership transfers instantly and makes it easier for holders to borrow against their metal.

Several gold-backed tokens already exist, including XAUT from Tether and PAXG from Paxos. Banks such as HSBC also created versions of their own.

Even with this activity, tokenized gold is still small. XAUT has a little over $2 billion worth of gold backing it, while the largest gold ETF holds over $130 billion.

Gold demand has been strong this year. Retail traders have been moving money into gold ETFs as the metal hit record prices during global trade, fiscal and geopolitical tension.

Tokenized gold gives holders direct ownership of the metal instead of the indirect setup used in ETFs. The company said this difference matters to investors who want a simple way to hold gold and move it inside crypto markets.

The company said the first attempt at DGLD failed because the market was not ready. This time, MKS PAMP said demand from crypto investors and large funds gives it a stronger base.

The company said it expects interest to grow because more people want to hold gold in a format that works around the clock and supports fast settlement. The company added that it believes the combination of gold’s strong year and the rise of tokenized real assets gives DGLD the environment it did not have in 2019.

MKS PAMP also addressed the challenge of vaulting costs. Most gold-backed tokens cover storage fees by charging users when minting or redeeming tokens.

MKS PAMP said it will not do that at first, and it will give users time before adding any charges tied to storing the underlying metal.

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