Tokenised commodities and art

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A gold token is a claim against the issuer for delivery of gold, or a representation of a share in gold the issuer holds. PAX Gold and Tether Gold, the two largest, give the holder a right to redeem for physical gold in minimum quantities and otherwise hold the gold in London vaults under the issuer's title.¹ The holder's position is contractual, which FINMA's 2019 stablecoin supplement recognised when it classified commodity-linked tokens as deposits or as asset tokens depending on whether the holder has a property right in specific bars.² A Swiss issuer that holds allocated gold for the holder under a bailment and issues a token representing it is a custodian of a thing and the holder owns the gold under Art. 641 CC. A Swiss issuer that holds unallocated gold and promises delivery is a debtor and the holder is a creditor.

Tokenised art follows the same analysis with an added copyright layer. An NFT linked to a physical painting represents whatever right the issuer has granted, which is usually nothing beyond the token itself unless a sale agreement or trust transfers title to the painting. Fractionalised ownership of a painting through tokens is a collective investment in both hubs if a manager controls the painting on behalf of the holders. Part E, Chapter X and Part K, Chapter IX treat the fractionalisation question. The practical advice is identical to that for real estate: identify the vehicle that owns the physical object and analyse the token as an interest in that vehicle.

Notes

Paxos Trust Company, PAX Gold Terms and Conditions (redemption in whole-bar increments of approximately 430 troy ounces, or smaller quantities through partners); TG Commodities Ltd, Tether Gold Terms of Service. Both documents are revised periodically and the current version should be checked. ↩
FINMA Supplement to the ICO Guidelines, 11 September 2019, section 2.2 (tokens linked to commodities; property right v contractual claim). Part E, Chapter VII. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of October 2026.

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Dr Alexander Ressos, TEP

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I am Of Counsel with KGP Legal LLC in Singapore, where I work with a global client base of successful entrepreneurs and their families, independent asset managers, commodity trading houses and other commercial clients. I am a German and Swiss attorney-at-law, also admitted as a solicitor in England & Wales and in Hong Kong. I divide my time between Zug in Switzerland, Singapore and Hong Kong. Since 2017 I have advised international clients on more than 700 crypto and digital asset projects. I also have extensive experience in cross-border litigation and arbitration in Singapore, Hong Kong and other markets in South-East Asia and Greater China.

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