Tokenized gold passes DeFi stress test, but less than 2% is used as collateral

The article says tokenized gold has held up well in DeFi stress testing, but usage as lending collateral remains very limited. RedStone found that although tokenized gold trading volume reached $90.7 billion in Q1 and gold futures briefly rallied above $5,600 per ounce, only about $63 million of Tether Gold (XAUT) and PAX Gold (PAXG) is deployed as collateral on Aave v3 and Morpho, or roughly 1.5% of their combined $4.2 billion market cap. A notable liquidation wave on March 23 during a sharp gold sell-off showed tokenized bullion can function reliably under market stress. The piece frames the market impact as constructive for tokenized gold’s credibility, but negative for adoption momentum because DeFi lending penetration remains small.