What is PAX Gold (PAXG)?
PAX Gold (PAXG) is a regulated gold-backed token issued by Paxos Trust Company, supervised by the New York State Department of Financial Services (NYDFS). Each PAXG token represents one fine troy ounce of a London Good Delivery gold bar stored in Brink's vaults in London. PAXG brings institutional-grade gold exposure to the blockchain with the regulatory trust of a NYDFS-supervised asset-backed token.
Key Facts
What is PAX Gold?
PAX Gold (PAXG) is a gold-backed blockchain token that provides regulated exposure to physical gold. Each PAXG token represents one fine troy ounce of a London Good Delivery gold bar, stored in Brink's vaults in London. Paxos Trust Company, the issuer, is supervised by the New York Department of Financial Services (NYDFS).
What distinguishes PAXG from other gold-backed tokens is its regulatory framework. Paxos operates under a New York trust charter, which requires regular examinations by NYDFS, monthly attestation reports by independent auditors, and segregation of customer assets.
PAXG holders benefit from the same regulatory protections that apply to traditional trust company customers.
PAXG provides allocated gold ownership — each holder can look up the specific gold bar serial numbers associated with their tokens using Paxos's online tool. There are no custody or storage fees for holders.
The gold is insured and stored at Brink's, one of the world's most established secure custody providers.
Who Created PAX Gold? A Brief History
Paxos Trust Company
Paxos Trust Company was founded in 2012 by Charles Cascarilla and Rich Teo with the vision of using blockchain technology to modernize financial infrastructure.
The company obtained a New York trust charter from NYDFS in 2015, becoming one of the first crypto-focused companies to receive this designation. This regulatory foundation enabled Paxos to issue regulated digital assets.
Launch of PAX Gold
In September 2019, Paxos launched PAX Gold (PAXG) as a way to bring regulated, blockchain-based gold ownership to investors. Building on its experience with the Pax Dollar stablecoin and BUSD (issued for Binance), Paxos applied its regulatory-compliant token framework to gold.
PAXG was designed to eliminate the friction of physical gold ownership while maintaining institutional-grade custody and regulation.
Key Milestones
- • 2012: Paxos (originally itBit) founded by Charles Cascarilla and Rich Teo.
- • 2015: Paxos receives New York trust charter from NYDFS.
- • 2018: Paxos launches Pax Dollar stablecoin (now USDP) under NYDFS oversight.
- • 2019: PAX Gold (PAXG) launches — regulated, gold-backed token on Ethereum.
- • 2021: PAXG market cap grows as gold prices rise; increasing DeFi integration.
- • 2023: Paxos ends BUSD issuance; refocuses on USDP, PAXG, and enterprise services.
- • 2024: PAXG remains the leading regulated gold token; Paxos expands international operations.
How PAX Gold Works
PAX Gold operates through a regulated minting and redemption process that maintains a 1:1 link between tokens and physical gold.
Token Minting & Redemption
When users purchase PAXG directly from Paxos, new tokens are minted and an equivalent amount of gold is allocated to the buyer. Each token is linked to a specific gold bar with a unique serial number, refiner hallmark, and assay certificate.
When tokens are redeemed, they are burned and the corresponding gold is released. This create/redeem mechanism keeps PAXG's price anchored to the gold spot price.
ERC-20 on Ethereum
PAXG is an Ethereum ERC-20 token, giving it broad compatibility with wallets, exchanges, and DeFi protocols. However, unlike some other gold tokens, PAXG is only available on Ethereum — it does not have TRON or other chain versions. Paxos charges a small on-chain transfer fee (0.02% of the transfer amount) for PAXG transfers.
Brink's Vault Custody
Paxos uses Brink's, one of the world's leading secure logistics and precious metals custody providers, to store all PAXG gold in London. Brink's provides insured, allocated storage — meaning each bar is specifically assigned to Paxos and its PAXG holders, not pooled with other customers' gold.
This allocated model provides stronger ownership claims than pooled or unallocated gold accounts.
Monthly Attestations
Each month, an independent accounting firm audits the gold reserves backing PAXG and publishes an attestation report. This report verifies that the total number of PAXG tokens in circulation is fully backed by an equal amount of physical gold in Brink's vaults.
The attestation process is a NYDFS requirement and provides regular third-party verification of reserves.
Regulatory Framework
PAXG benefits from one of the strongest regulatory frameworks in the crypto asset space:
NYDFS Oversight
Paxos Trust Company operates under a New York trust charter, one of the most stringent regulatory frameworks for financial institutions in the United States.
The NYDFS supervises Paxos's operations including capital reserves, consumer protection, anti-money laundering compliance, and cybersecurity standards. This level of oversight provides institutional confidence that is rare in the crypto asset space.
Trust Charter Benefits
As a regulated trust company, Paxos is legally required to hold customer assets separate from company assets.
This means PAXG gold would be protected in the event of Paxos's bankruptcy — a critical distinction from unregulated token issuers where customer assets could be at risk in insolvency proceedings.
Reserve Verification
PAXG's reserve verification goes beyond simple attestations. Paxos provides a lookup tool where any PAXG holder can enter their Ethereum address and see the specific gold bars allocated to their tokens, including serial numbers, refiner names, and weight.
This per-holder transparency is combined with the monthly third-party attestation reports required by NYDFS.
Why PAX Gold Has Value
PAXG's value proposition centers on trust: it is the only gold-backed token issued by a NYDFS-regulated trust company with mandatory monthly attestations and segregated customer assets. For investors who want gold exposure on the blockchain, PAXG offers the highest level of regulatory assurance available.
Institutional adoption of PAXG is driven by regulatory clarity. Unlike unregulated alternatives, PAXG meets the compliance requirements of banks, asset managers, and financial advisors.
The combination of allocated gold, independent audits, and a regulated custodian makes PAXG acceptable for institutional portfolios that require clear legal frameworks.
PAXG offers practical advantages over physical gold and gold ETFs: no storage or custody fees (ETFs charge 0.25-0.40% annually), 24/7 trading, fractional ownership, self-custody capability, and DeFi composability. The zero-fee custody model means long-term holders benefit from gold appreciation without fee erosion.
How to Buy PAX Gold
PAXG is available on major regulated exchanges and directly from Paxos.
1Compare providers
Use coinvela to compare PAXG prices and fees across exchanges. Kraken and Coinbase offer broad PAXG support, and you can also purchase directly from Paxos for the most direct gold ownership.
2Create an account
Sign up with your chosen exchange and complete identity verification (KYC).
3Fund your account
Deposit funds via bank transfer, wire, or other supported payment methods. Direct purchases from Paxos require a Paxos account.
4Buy PAXG
Navigate to the PAXG trading pair (e.g., PAXG/USD or PAXG/USDT) and place your order. You can purchase fractional amounts — you don't need to buy a full troy ounce.
5Store Securely
Transfer PAXG to a personal Ethereum wallet for self-custody. PAXG is an ERC-20 token, so any Ethereum-compatible wallet works. Note that on-chain transfers incur a 0.02% Paxos fee.
Next step: Compare PAXG exchange rates and fees to find the best price.
How to Store PAX Gold
Wallet Types for PAXG
PAXG is an ERC-20 token on Ethereum and can be stored in any Ethereum-compatible wallet:
- • Software Wallets: MetaMask, Coinbase Wallet, or Trust Wallet. Good for active trading and DeFi interactions.
- • Hardware Wallets: Ledger or Trezor for maximum security. Supports PAXG as an ERC-20 token. Best for long-term gold holding.
Hardware Wallets
For maximum security, use a Ledger or Trezor hardware wallet. These devices store your private keys offline, ensuring your gold-backed tokens are protected from online threats. Given that each PAXG represents over $2,000 worth of gold, hardware wallet security is strongly recommended for significant holdings.
Protect Your Recovery Phrase
Your recovery phrase is the only way to restore access to your PAXG if your device is lost or damaged. Store it on paper in a secure location — never digitally. Losing your recovery phrase means permanently losing access to your regulated gold ownership.
How to Use PAX Gold (PAXG)
Gold Portfolio Allocation
PAXG enables traditional gold allocation strategies in on-chain portfolios. Financial advisors commonly recommend 5-15% gold allocation for diversification.
PAXG makes this possible within crypto portfolios without requiring separate brokerage accounts or ETF positions, and the regulated structure makes it suitable for institutional allocations.
DeFi Collateral
As an ERC-20 token, PAXG can be used as collateral in DeFi lending protocols, allowing holders to borrow against their gold holdings without selling. This enables gold-backed leverage strategies and liquidity access while maintaining gold exposure. However, liquidation risks apply if gold prices drop significantly.
Institutional Use
PAXG's regulatory compliance makes it suitable for institutional use cases: treasury diversification, client gold exposure products, cross-border gold settlement, and regulated portfolio construction.
The NYDFS oversight and monthly attestations meet compliance requirements that many institutions require.
Risks
PAXG carries risks including: Ethereum network congestion (high gas fees during peak usage), counterparty risk (reliance on Paxos and Brink's), gold price volatility (gold can decline 20%+ in downturns), the 0.02% on-chain transfer fee reducing DeFi composability, and regulatory risk (changes in NYDFS requirements or gold custody regulations).
However, Paxos's regulated trust structure provides stronger protections than most crypto assets.
Notable People Behind PAX Gold
PAX Gold was created by the Paxos team, pioneers in regulated digital asset infrastructure.
Charles Cascarilla
Co-founder and CEO of Paxos. Cascarilla has led Paxos from its founding in 2012 through its evolution into a leading regulated digital asset company.
Under his leadership, Paxos obtained the first NYDFS trust charter for a crypto company, launched PAXG, and built enterprise stablecoin infrastructure used by PayPal (PYUSD) and previously Binance (BUSD).
Rich Teo
Co-founder of Paxos and former head of Asia-Pacific operations. Teo co-founded the company with Cascarilla and played a key role in building Paxos's institutional client base and international expansion. His financial services background helped shape Paxos's compliance-first approach.
Dan Burstein
Chief Legal Officer of Paxos. Burstein oversees the legal and regulatory strategy for all Paxos products including PAXG. His work on the NYDFS trust charter framework and monthly attestation process has established the regulatory standard for gold-backed tokens in the United States.
Regulation Overview for PAX Gold
Regulatory Overview
PAXG is one of the most regulated crypto assets in existence. As a product of a NYDFS-supervised trust company, PAXG operates under one of the strictest regulatory regimes available for digital assets. This regulatory positioning is a core differentiator for PAXG in the gold-backed token market.
Regulation by Country
PAXG's regulatory status benefits from Paxos's compliance framework:
United States: Paxos is a New York-regulated trust company supervised by NYDFS. PAXG is fully compliant with US regulations and available to US investors on major exchanges including Kraken and Coinbase. Monthly attestation reports are publicly available.
Canada: PAXG is available on Canadian-accessible exchanges. Paxos's regulated status and transparent reserves make PAXG a well-regarded digital asset under Canadian regulatory frameworks.
European Union: Under MiCA regulations, asset-referenced tokens like PAXG may require specific authorization for EU distribution. Paxos's existing regulatory compliance positions it well for MiCA requirements.
Australia: PAXG is available on Australian exchanges. Paxos's NYDFS regulation and monthly attestations provide transparency that aligns with ASIC's expectations for crypto asset products.
PAXG's regulatory advantages are significant: NYDFS oversight, mandatory reserve segregation, monthly independent attestations, and consumer protection rules.
These features make PAXG one of the most institutionally acceptable crypto assets available, though regulatory requirements continue to evolve globally.
FAQs About PAX Gold (PAXG)
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