Cryptocurrency exchange Bybit is enabling customers to earn interest payments on tokenized gold products.
The world's second-largest cryptocurrency exchange by trading volumes has launched “XAUT Earn,” a new product that enables users to earn interest on tokenized gold holdings.
Specifically, XAUT Earn enables users to generate yield on Tether Gold (CRYPTO: $XAUT), a digital asset backed by physical gold bullion.
• Ripple, The Company Behind XRP, Is Valued At $50 Billion
Bybit says that it is offering users of its crypto exchange an alternative model for gold ownership by combining exposure to the spot price movements of gold with income generation.
Most gold investment vehicles, including traditional exchange-traded funds (ETFs), don’t’ offer any yield or interest to investors. As a precious metal, gold is a non-yielding asset.
The SPDR Gold Trust (NYSE: $GLD), the world’s largest gold ETF, does not offer a dividend payment to shareholders.
Bybit says that it is offering two XAUT savings products to its customers: a flexible staking and fixed-term savings products, both offering yield generation.
Management at Bybit says that it is launching the new interest-bearing tokenized gold products as demand grows for assets that combine capital preservation with yield generation.
The price of gold has surged more than 70% over the past year as investors seek out the yellow metal as a safe haven asset amid rising geopolitical tensions and market uncertainty.
Gold’s price hit an all-time high of $5,597.23 U.S. per ounce on January 29 of this year as central banks and individual investors continued buying the precious metal.
Bybit’s stock does not currently trade on a public exchange.