Ripple CEO: Dutch $11B gold transfer suits tokenization

Brad Garlinghouse, chief executive of Ripple, said a reported $11 billion transfer of Dutch gold reserves illustrates how tokenized assets on a blockchain could simplify settlement and custody for bullion.

Garlinghouse argued that on-chain tokens representing physical gold would let central banks and custodians move ownership and value without physically shipping metal. He said digital records and instant settlement could cut back on the logistics tied to traditional transfers.

Tokenization converts a physical asset or a claim on that asset into a digital token on a distributed ledger. In Garlinghouse’s description, a tokenized gold unit could be transferred between parties and recorded immediately on a blockchain, reducing the number of intermediaries and the paperwork required for custody changes.

His comments followed reports that Dutch authorities shifted about $11 billion of official gold reserves. Physical transfers of bullion typically require armored transport, insurance, specialized storage and days or weeks of custody reconciliation, Garlinghouse noted.

Ripple has promoted blockchain for cross-border payments and asset tokenization, offering services intended to speed settlement and provide on-demand liquidity using digital assets. The company has described tokenized versions of currencies and commodities as a way for banks and institutions to settle without waiting for correspondent processes to conclude.

Regulators and financial institutions have approached tokenized assets cautiously. They are seeking clarity on custody rules, settlement finality and the legal status of on-chain tokens as claims on physical assets. Central banks would need new standards for auditing, insurance and cross-border recognition before shifting reserve holdings to tokenized forms.

“An $11 billion gold transfer is an ideal use case for cryptocurrency,” Garlinghouse wrote, emphasizing on-chain recordkeeping and the potential to reduce reliance on physical logistics and multiple custodians.

Industry participants point to potential efficiency gains from tokenization, while others raise questions about legal recognition, custody guarantees and the market infrastructure needed to support tokenized reserves. Any broad adoption would require agreement among central banks, custodians and regulators on technical and legal frameworks.