Tokenized gold: PAXG lacks MiCA approval, what to check before October 30

Anyone holding tokenized gold through a European exchange is losing that position right now: Coinbase is ending support for 14 tokens for retail customers in the European Economic Area, and alongside the familiar dollar stablecoins that list also carries PAXG. The cut-off date is October 30. Whatever is left in the account after that, the exchange converts into USDC on its own initiative, so into a dollar token. A claim on gold turns into a claim on dollars, and the holder does nothing to bring it about.

The reason sits in the rulebook rather than at the exchange. Under the EU's MiCA regulation, gold tokens fall into a category of their own, and to this day not one issuer holds an authorization in that category. This article sets out what PAX Gold actually is, why a gold bar becomes a regulatory problem case, which routes remain open to investors in Germany, and what the forced swap means for tax.

What PAX Gold is: one token for one troy ounce in a London vault

PAX Gold, PAXG for short, is a token on the Ethereum blockchain that represents one troy ounce of physical gold per unit. The troy ounce is the trading measure of the gold market and equals 31.1035 grams of pure gold. On its own product page, the issuer Paxos states that each token stands for one troy ounce of a gold bar meeting the London Good Delivery standard, stored in vaults of the London Bullion Market Association. On that account, anyone holding PAXG has ownership rights in the underlying gold, held in custody by Paxos Trust Company.

London Good Delivery is a written specification and not a marketing phrase. The standard sets fineness, weight range and provenance records for a bar so precisely that wholesalers accept it without testing it themselves. Paxos cites monthly attestation reports for the allocated gold and says it charges no storage fees. The company itself is a US trust company supervised by the Office of the Comptroller of the Currency.

The practical appeal lies in divisibility. A bar under the LBMA standard weighs around 400 troy ounces and therefore costs more than a million euros, while a token can be transferred in fractions. The price tracks gold: on Tuesday morning PAXG stood at $4,063 or 3,652 euros per token, a good 1 percent above the previous day.

October 30: Coinbase converts 14 tokens into USDC

Coinbase has told its customers in the European Economic Area that 14 assets will no longer be supported in the retail business. According to consistent reports, the affected assets are USDT, PYUSD, USD1, DAI, PAX, GUSD, GYEN, BUST, UST, RAI, PAXG, MUSD, USDS and TGBP. Buying, selling and swapping these assets is already blocked on the European platform. Until the cut-off date, only withdrawal to an external wallet remains open.

Whoever does nothing by then keeps the value but not the asset: remaining balances are converted into USDC or another supported asset at the market rates applying at that point. For deposits that arrive after the deadline, the exchange explicitly promises no credit and no recovery. That last line is the most important part of the whole process, because it also catches anyone who sends tokens to an old deposit address out of habit.

This is not a one-off at a single exchange. The same movement has been running through the European market for months, and we described the forced conversion at Coinbase back in early October, with the focus then on USDT and DAI. That PAXG, a gold token, also sits on the list follows a logic of its own, and that logic is in the regulation.

Why a gold bar becomes an asset-referenced token under MiCA

MiCA splits crypto assets into groups, and strict special rules apply to two of them. The first are e-money tokens, which reference a single official currency, such as a euro or dollar token. The second are asset-referenced tokens, known in the jargon as ART: tokens whose value rests on a reference other than a single currency. Gold is exactly such a reference.

That places every gold token in the ART category, where the obligations are heavy. In its specialist article on the regulation, German regulator BaFin sets out the outline of the framework it has applied to German issuers since 2024. An ART issuer needs an authorization from its national supervisor or must itself be an authorized credit institution. On top of that come an officially approved white paper, own funds requirements, a separately held reserve and a permanent redemption right for holders.

That severity is deliberate. The ART rules grew out of a concern that private tokens might come to sit alongside the euro as a means of payment on a large scale. The regulation therefore provides an additional tier for particularly large ARTs, with higher capital and liquidity requirements, and the European Central Bank can designate any ART it considers sensitive for monetary policy. Within that framework a tokenized gold bar is legally the same thing as a currency-basket token, even though hardly anyone uses it to pay.

The ART category has been open since June 2024 and is still empty

The rules for asset-referenced tokens have applied since June 30, 2024. Two years on, research by the trade outlet crypto.news finds not one authorized issuer in the category. The figure is zero and not merely low: no gold token, no basket token, no commodity token of any kind. The most detailed crypto regulation in the world thus has a drawer it built for gold itself, and that drawer is unoccupied.

The market for it, meanwhile, is anything but small. The two leading products, PAX Gold and Tether Gold, together carried around $5.1 billion on Tuesday morning. The trade outlet put an slightly earlier reading at just under $4.4 billion, and the gap is explained by the higher gold price. Converting market capitalization back into troy ounces, the two tokens stand on just under 39 tonnes of gold, of which about 13.9 tonnes sit at PAX Gold and around 25.2 tonnes at Tether Gold. Both products lie outside the formal EU framework, and both are held by Europeans.

Brussels is now debating the gap itself. The Commission is examining whether MiCA should extend to tokenized real-world assets, DeFi and staking, which also puts the empty ART category back in question: either the requirements become workable, or the category disappears. Until then the position stands as it is.

Paxos is licensed in Finland, PAX Gold is not

Here lies the mix-up that blocks the view for many holders. Paxos is indeed authorized in the European Union: the group runs an entity supervised in Finland and uses it to bring the dollar token USDG to the European market as an e-money token. That licence covers precisely what it was granted for. A dollar e-money token and an asset-referenced gold token are two different products under MiCA, with two different procedures.

For PAX Gold that means the issuer is reachable in Europe while the product still holds no authorization in the European framework. An authorized exchange in the EU may therefore not keep a non-compliant token permanently tradable, and that duty is exactly what Coinbase is now implementing. To check which permission a trading venue works under in Europe, the classification is in our comparison of exchanges with MiCA authorization.

Holding PAXG is not prohibited by any of this. The regulation addresses issuers and service providers, not private individuals with a wallet of their own. A holder in Germany may own PAXG, transfer it and swap it on decentralized trading venues. What falls away is the convenient route through the regulated exchange.

Tether Gold compared: XAUT carries 25 tonnes, PAX Gold just under 14

The second large provider is Tether Gold, ticker XAUT, likewise a token on one troy ounce. By supply XAUT is the bigger product: around 809,000 tokens against roughly 446,000 at PAX Gold. On price the two sit almost level, separated by a good $8 on Tuesday morning. We already described XAUT in April 2025 as a hedge against trade conflicts; the regulatory position has tightened markedly since.

In regulatory terms both sit in the same boat, because both are ARTs without authorization. For holders in Germany they differ mainly in access and in proof. PAX Gold offers a lookup that shows the serial number, weight and vault of the allocated bar via a wallet address. According to the provider, that lookup works only for tokens in an Ethereum or Solana wallet, not for balances at an exchange or another custodian.

That leads to a point which gets lost in the notices about the deadline: whoever leaves tokenized gold sitting on an exchange holds an entry in that exchange's system. Only in a wallet of your own does the entry become a token whose backing can be checked individually.

Redemption and access: what holders keep without a regulated exchange

One point separates the token from an entry on an exchange account, and it is rarely named in the debate about deadlines: the redemption promise. For PAX Gold, Paxos cites redemption against dollars at the prevailing gold market price, at any time. Institutional users can additionally redeem against LBMA-accredited Good Delivery bars or against so-called unallocated Loco London gold, meaning gold on a clearing account of the London market. That claim is addressed to the holder of the token. Whoever leaves a balance at an exchange holds a claim against that exchange.

The route to buying remains open. If the regulated venue falls away, decentralized trading venues on the Ethereum blockchain remain available in the EU. There the user carries two costs that disappear into the price at an exchange: the network fee for every transfer and the price deviation when the order book is thin. Both can be read off before the swap, and both weigh more heavily on small amounts than on large ones.

In short, this leaves a trade-off with no comfortable answer. The advantage of a gold token lies in divisibility down to fractions of a troy ounce and in transferability at any hour, with no securities account and no safe deposit box. The price for that is the missing investor protection: for a digital asset without ART authorization, the regulation's duties on reserve, white paper and redemption do not bite, and there is no European supervisor a holder could turn to in a dispute. Anyone who values the convenience of the exchange is better served by physical gold or a gold security; anyone who needs the divisibility of the token takes on custody themselves.

The forced swap counts as a disposal for tax

For tax purposes the automatic conversion is not a neutral event. When PAXG is converted into USDC, the holder gives up one crypto asset and receives another. The tax office sees a disposal in that, even though nobody consciously sold. If the purchase is less than a year old, a gain becomes taxable under the rules for private disposals; if it is older, the one-year period applies. For the new USDC the clock starts again.

The deadline logic is what matters. Whoever withdraws tokens to their own wallet beforehand is only moving them, and a transfer between your own addresses is not a sale. Whoever leaves them sitting permits a tax-relevant swap at a price they do not set. Which records such a forced swap calls for, we set out in our piece on the tax consequences of the stablecoin forced swap.

The reform of the holding period changes nothing in this logic for now, but it stands behind every decision this year. As long as the one-year rule applies, the acquisition date of each individual holding is worth a look, and that calls for clean records from the time before the conversion.

Gold ETCs, bars and coins: the routes without a blockchain

For the wish to hold gold in a portfolio, Germany offers routes that MiCA does not touch at all. The most direct is physical investment gold as a bar or coin: the purchase is exempt from VAT, the gain is tax-free after a one-year holding period, and no custodian is needed. Against that stand the spread, shipping and, where applicable, safe deposit rent, and divisibility ends at the smallest denomination.

The second route is exchange-traded gold securities, such as the gold ETCs common in Germany that carry a delivery claim. Their tax treatment is contested: several tax portals rely on rulings of the Federal Fiscal Court under which an ETC with an exercisable delivery claim is treated like physical gold and stays tax-free after one year, while other accounts assume withholding tax regardless of holding period. The judgment years cited differ between sources, and only a tax adviser can give binding advice here.

The third route remains the token, but then in self-custody. Technically PAXG is an ordinary token on the Ethereum blockchain and can be transferred to any wallet that supports the standard. An app serves for storage as well as a dedicated device does. Worth bearing in mind are the network fees on transfer and the question of which trading venue a later sale should run through.

What January adds: the ESMA deadline for non-compliant tokens

This week's date belongs to a single provider. Behind it stands a date that applies to the whole European market. European securities regulator ESMA published a statement in early October under which authorized platforms should end services around non-compliant tokens as quickly as possible and within three months at the latest. That yields January 8, 2027 as the outer edge. The details are in our piece on the ESMA deadline for the USDT exit.

An ESMA statement does not apply directly as a legal norm. The text binds the national supervisors, and in Germany BaFin has to enforce it. In practice the trading venues follow it, and the order of the shutdowns follows the pace of the individual houses. For holders of gold tokens that means further deadlines of this kind are more likely than a return of the tokens to regulated trading, as long as the ART category stays empty.

How the Commission handles the gap remains open. Were a workable authorization for commodity tokens to arrive, gold tokens could return to Europe on regulated terms. There is no date for that, and until then tokenized gold in the EU remains a product you can hold but can barely trade on authorized platforms.

Tokenized gold: without ART authorization only your own wallet is left

The position fits into one sentence: the gold behind the tokens still sits in London vaults, while the route to it through a European exchange is closing. Three steps make sense now.

1. Review balances before the cut-off date. Check in every account whether one of the 14 assets is sitting there, and withdraw it to an address you control yourself. Which device serves for that is shown by the hardware wallet comparison.
2. Record acquisition data. Note the purchase date, quantity and price for every holding before an automatic swap blurs the trail. The suitable tools are in the comparison of crypto tax tools.
3. Settle the future trading route. Before the next purchase, decide which venue a sale should run through, and which permission that venue holds in Europe. The classification comes from the comparison of exchanges with MiCA authorization.

(As of October 28, 2026. This article is not investment advice. Prices and fee structures change; check the terms with the provider before you buy.)