CZ Warns of Counterparty Risks in Tokenized Gold

Binance founder Changpeng Zhao has criticized Peter Schiff’s new app-based tokenized gold platform, warning it carries significant counterparty risk. The platform issues digital tokens representing claims on physical bullion stored in third-party vaults. Zhao argues that relying on custodians exposes investors to bankruptcy, hacks, or management changes that could prevent redemption. He dismissed such tokens as “trust me bro” promises rather than true on-chain assets. Schiff defended his plan by citing established gold custodians like Brinks and comparing the model to stablecoin custody. The debate highlights ongoing challenges in real-world asset tokenization and on-chain ownership. Crypto traders should monitor demand for gold-backed tokens, developments in custodial protocols, and potential shifts toward Bitcoin as scrutiny of tokenized assets intensifies.