The world of cryptocurrency is no stranger to debates surrounding the value of various assets, and the recent clash between Changpeng Zhao and Peter Schiff has ignited discussions about the role of gold in the digital economy. Zhao, the former CEO of Binance, has publicly dismissed Schiff’s plan to introduce a tokenized gold product, stating it cannot be considered a true digital equivalent of gold.
In a series of statements, Zhao made it clear that while tokenized gold may exist on the blockchain, it fundamentally relies on centralized entities for the holding and redemption of physical gold. This critical distinction reveals that tokenized gold is more akin to an IOU rather than actual ownership. Zhao’s comments come in response to Schiff’s recent proposal to offer tokenized gold through his platform, SchiffGold, which aims to provide users with a cheaper and faster alternative to Bitcoin for transferring gold.
Changpeng Zhao Slams Trust-Based Tokenized Gold
Zhao articulated his viewpoint by emphasizing that tokenized gold is not the same as on-chain gold, cautioning that users are essentially placing their trust in a third party to deliver gold at some unspecified future date. He highlighted the fragility of such a system, suggesting that changes in management or crises could jeopardize the promise of gold delivery.
Saying the obvious. Most people “in crypto” know this, most people “not in crypto” may not understand yet.
Tokenizing gold is NOT “on chain” gold.
It’s tokenizing that you trust some third party will give you gold at some later date, even after their management changes, maybe… https://t.co/KMYfz2dG04
— CZ 🔶 BNB (@cz_binance) October 23, 2025
By relying on third-party custodians, Zhao argues, tokenized gold undermines the very principles of decentralization that are foundational to the crypto movement. He contends that cryptocurrencies should aim to eliminate the necessity for intermediaries, a goal that tokenized gold fundamentally contradicts.
Schiff’s Vision for Tokenized Gold
On the other hand, Peter Schiff remains optimistic about his vision for tokenized gold, asserting that it could serve as a superior alternative for blockchain utilization compared to Bitcoin. Schiff argues that gold will maintain its purchasing power over time and can fulfill many of the promises that Bitcoin offers.
His platform, SchiffGold, is designed to allow users to purchase gold and store it securely. Users will have the option to transfer ownership or redeem their tokens for physical gold, which Schiff believes could position tokenized gold as a serious competitor to Bitcoin.
Despite Schiff’s enthusiasm, Zhao’s skepticism underscores a profound concern about the trust-based nature of tokenized gold. He maintains that this reliance on external parties contradicts cryptocurrencies’ core tenets of decentralization and independence from centralized control.
Bitcoin vs. Gold Market Capitalization
In his recent remarks, Zhao also pointed out the potential for Bitcoin to eventually surpass gold in market capitalization. Currently, gold’s market cap stands at approximately $28.5 trillion, while Bitcoin’s market cap is around $2.18 trillion. Zhao expressed confidence that Bitcoin’s market cap would eventually exceed that of gold, although he acknowledged the substantial gap that still exists.
Notably, Bitcoin’s limited supply, with around 19.93 million BTC in circulation, is a significant factor in Zhao’s optimistic outlook. He highlighted Bitcoin’s rapid growth trajectory since its inception, having surpassed the $1 trillion mark within six years of its launch in 2009. While Zhao is optimistic about Bitcoin’s future, he recognizes the challenges ahead in closing the gap with gold’s market dominance.
The ongoing dialogue between Zhao and Schiff serves as a reminder of the complexities and differing philosophies within the cryptocurrency space. As the market continues to evolve, the debate over the role of traditional assets like gold in the digital economy is likely to remain a contentious topic.
