CIP#12 - Which tokens should be included in a gold pool?


Curve should have a new liquidity pool for tokenised Gold.


After a request for suggestions of which tokens could be included in a gold pool, we have received a lot of feedback. This CIP is the first step in formalising the shortlist which should consist of four gold tokens.


This will start as a poll to allow participants to vote for multiple options, it will then proceed to a signalling vote where users will need to vote using their veCRV.

The shortlist is as follow:

  • PAXG
  • PMGT
  • SXAU
  • XAUT

@danschatt (of uphold), (of cache gold) have both made cases for their respective tokens on the original thread: [Discussion]Tokenised Gold Pool
We invite governance participants to familiarise themselves with the options available.

There has been good arguments made that XAUT (Tether Gold) should be excluded due to the lack of transparency of Tether. However, XAUT does have high liquidity

There has been arguments made against low liquidity/cap tokens


  • PAXG
  • PMGT
  • SXAU
  • XAUT

0 voters


I urge people to not vote for XAUT, Tether Gold. Liquidity is tempting to use but realistically a gold pool should only have very solid tokens and Tether is just not transparent enough for it.

Don’t forget there’s also the option to add a secondary pool later on.


Should we not have a rundown of each token in more detail so people can make an informed decision about them?

I am unaware as to why Tether is considered less transparent than the other options, and I know that despite it being the stablecoin with most adoption and longevity, it is regularly treated like the bogeyman of DeFi. Ironic since other competitors considered more decentralized or trustworthy have a track record of being less reliable than Tether. So I have to wonder, are the transparency concerns grounded in reality?


Someone posted a breakdown of caps and liquidity (not necessarily relevant for sXAU for example) on the other thread, perhaps an updated one should be good. Would need to include transfer fees, redemption fees and whatnot. Maybe there is a tokenised gold specialist somewhere on this governance forum!


The CGT ( option is definitely interesting - in addition to handling the transfer fee CGT and PAXG have, can Curve also handle the fact CGT is priced in grams rather than ounces? Also, can maybe tell us more about themselves? CGT is definitely an interesting option, because it has storage in multiple countries and is also redeemable in less than 400+oz bars - assuming their redemption fees aren’t outrageous, i could see a lot of people just buying physical that way given the premiums old school dealers are currently charging.


I think that may be a problem actually. @angelangel0v ?

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Yah second this honestly only thing I know to vote for is sxau, never heard of anything else and I would just be guessing. I bet alot of people will.

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Here’s my quick take:
With the US printing and printing, and the US Fed easing its stance on inflation, the logic of holding non-dollar stable assets makes more sense. This extends especially to digital gold. So at the highest level, I like the idea.

However, the only two coins that I can tell that have significant transparency and market cap are Tether Gold and Pax Gold. gold stablecoins

Tether: Someone mentioned that Tether might be risky. The $92m market cap is small in the context of the $14B float of USDT. So, I’m not too worried about that.

Perth Mint Gold Token, Cache Gold, and sXAU are each too tiny in terms of market cap to matter. I wouldn’t risk supplying liquidity to a pool that contained them.

Regarding sXAU, I could imagine going along with them at some point, but I’m definitely concerned about any coin that has such a small a market cap. If Kain went along and put some significant depth behind sXAU, it might make some sense.

Regarding UPXAU, I can’t find it listed on CoinGecko, Nomics, or CoinMarketCap. I see it being pushed and possibly incentivized by @danschatt, who seems like a legitimate guy. Seems like he runs Cred, however, not UpHold. However, the lack of normal transparency is an obvious concern.

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According to CoinGecko, PaxGold has the 70% of the 24h Trading Volume. #2 is CGT at 17%. #3 is Tether Gold at around 12%. PMGT and sXAU have almost no volume.


@charlie_eth I think maybe you are referring to this post: [Discussion]Tokenised Gold Pool

Agree with @Julian’s reply generally. However, large market caps do not make gold-backed tokens track the price of gold any better. Liquid markets do that and redemption provides an alternative if markets become illiquid or otherwise dysfunctional. Although PAX Gold clearly has the most listings and adoption so far, their markets tend to be illiquid and/or have asymmetric liquidity (more buys than sells or more sells than buys) and there is a huge range in price between different markets - currently $1,830 to $2,070. Redemption should provide an arbitrage opportunity but due to the high minimum redemption of 430 troy ounces, however it doesn’t seem possible to purchase 430 PAXG (~$832,000 USD at current gold spot) on any exchange at anywhere near the spot price.

There are also transparency issues with both PAXG and XAUT.

I would add that Tether Gold (XAUT) really doesn’t have good liquidity either except maybe on their own exchange (Bitfinex) in the last 24 hours they had less than $2,000 volume on FTX (the only other exchange they are listed on according to Coin Market Cap). On FTX a lot of the volume is in XAUT derivatives.

With a $96 million market cap and their own exchange at their disposal (and only two exchange listings total) one would expect a rock solid peg to the price of gold. One would also expect much higher trading volumes unless there is simply little demand for this token.

Neither PAXG nor XAUT track the price of gold very well which is why redemption is critical but impractical due to the 430 troy ounce minimum. In the current markets it’s difficult or perhaps impossible to obtain 430 PAXG or 430 XAUT at anywhere near the spot price. It’s also worth noting that 400 troy ounce good delivery bars actually range in weight from 350 troy ounces to 430 troy ounces, and they range in purity from (anything >=0.995 is accepted). Since both PAXG and XAUT require you to have 430 troy ounces to redeem, it would seem that they intend to randomly assign you a bar and that you will then be left with anywhere from 0-80 tokens (up to $154,000 USD worth!) that you will need to dispose of some other way. (We strongly encourage the community to examine the order books closely for all gold tokens and see what type of slippage you can expect on a $150K order!). It is unclear why neither firm takes a similar approach to CACHE and allow users to select the bar they wish to redeem which would allow users to acquire the exact number of tokens they need for the bar they want.

On the other hand CACHE’s redemption system is fully functional and the data regarding the redemptions is completely public. When gold is redeemed the tokens are removed from circulation until new gold is added. We have had 1,462 grams redeemed to date (~47 troy ounces, ~$91,000) - it is not a huge sum but it is totally public and transparent. Does anyone know how many bars have been redeemed from PAXG or XAUT? Or how the circulating supply is managed when redemptions occur and what kind of transparency there is around that process?

CACHE redemption data is always available to the public in real-time. You can see redemptions as they occur when tokens are sent to the redemption address. You will then see tokens equivalent to the actual pure weight of the bar(s) redeemed moved and locked up in the unbacked treasury.

Most recently you will see 999.9 CGT being transferred back into circulation which corresponds with this 1 kg bar that was recently added to the system (you can even see the deposit receipt). It is 999.9 because CACHE Gold works on pure weight allowing it to easily support different bars, with different weights and different purities (even 400 oz LBMA bars, although we don’t think they’re very practical). If there were no tokens in the unbacked treasury, new tokens would have been minted.

Happy to answer any questions you have.


Hi @WormholeOracle,

You can have a look at our whitepaper, our website, our Maker Collateral Onboarding Proposal and our discussion thread here.

If there is anything else you would like to know, please let us know!



CACHE Gold redemption fees are 15 basis points (0.15%) regardless of quantity redeemed with the exception of vault pickup at The Safe House which is 15 basis points or 1 CGT minimum. PAXG fees start at 1% and scale down to 15 basis points >=$400,000.

Another thing worth noting which may be relevant for Curve: When testing XAUT on Uniswap, it didn’t work. There was some issue with the transfer function that did not allow it to be withdrawn. According to the Uniswap team, these tokens are stuck there forever unless Tether has the ability to upgrade their contract and they do so.


Our market cap is not $413,162 it’s ~$2,153,000, also see our token supply explanation. Coin Market Cap has made some arbitrary and incorrect deduction to our supply. One can’t help but wonder why they allow 100.00% of PAXG to be considered “in circulation” when over 35% are in what is clearly their treasury and shows 0 ounces of gold backing it according to PAXG’s own “Allocation Report”.

Tether has other issues.

For anyone that has the means, we would strongly encourage you to try to buy 100g worth ($6,250) of each and see how close to spot you can actually purchase it. CACHE Gold will be the only one you can redeem for physical gold. How close to spot can you now sell these tokens back for? Examine the order books on the exchanges more closely, how much can you actually buy and sell close to spot price? We think you may be surprised by what you find.


I believe a dev did mention internally XAUT is weird token.

The issue with Cache gold is that Curve takes pegged assets. CGT is in gram and all the others are in ounces which makes CGT not suitable for this pool unless you have a solution ?


After checking it turns out that Cache Gold being priced in grams and not in ounce is not a problem


Is it not possible to just do the conversion in the smart contract?

Multiply the price by 31.10348? Or alternatively consider 31.10347687 as equal to 1.0 of any token that is denominated in troy ounces.

We felt grams were a better denomination to use because we believe 100g and 1kg bars offer a good balance between premiums and minimum redemption order. The smaller the bar the higher the premium. Common toz bars are 1oz, 10oz, 100oz and 400oz (actually 350-430oz and can have any purity >=o.995). 1oz tends to have a higher premium than 100g and 10oz is more triple the value of 100g.

CACHE is designed to provide support for any gold bar by reducing its value to pure grams. If you are comparing gross weight to pure weight the conversion is similarly easy. A bar with 0.9999 purity is worth its gross weight multiplied by 0.9999 in CGT. In our redemption system we always round down so you never receive less pure grams than the amount of CGT you redeem, even by a tiny fraction.

It’s also worth noting that CACHE and GramChain are designed to accommodate tokenization of other types of physical assets in the future, including those that aren’t commonly measured in troy ounces.

All of that said, whatever issues may arise we are happy to work with Curve any way we can to help solve them.

Also, CACHE would be happy to provide some dedicated liquidity for a guaranteed minimum time period to help bootstrap a new liquidity pool that includes CGT. We are extremely committed to supporting DeFi development and liquidity.


Cache Gold has no Ethereum transfer fee, right?

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It needs gas like any token transfer but there is no additional fee in ETH.

Can you come for a chat on Telegram?

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3 Likes Congrats guys - it’s a great approach and am glad for projects that continue to build the tokenised gold ecosystem (in the proper way!)

Wanted to clarify a couple of things mentioned about PAXG so that the community can make an informed decision:

  1. Redemption: PAXG can be redeemed directly for USD at spot price, for unallocated gold or gold bars (430oz). We do also offer smaller physical gold redemptions via partners for denominations as small as 1 gram. Believe partners now deliver to UK, US and Canada.

  2. Regarding lack of details using the “Allocation Report” tool - it’s stated that the tool does not work for custodial exchanges/wallets (tool limitation rather than lack of gold backing). Paxos does publish monthly attestation reports audited by Withum which certifies the requisite backing.

Disclaimer: I work for Paxos but not specifically the PAXG product so really just contributing as a community member. Love what the Curve team is doing!