German DeFi platform Swarm will launch P2P trading of gold NFTs

The platform is already offering tokenized versions of stocks and treasury bonds

25.06.2024 - 10:05

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Last updated on Aug 6, 2024

What’s new? Swarm Markets, a German real-world asset (RWA) tokenization platform, will offer users non-fungible tokens (NFTs) that represent the right to own gold. After undergoing identification and anti-money laundering (KYC/AML) compliance checks, users will be able to trade NFTs on a decentralized over-the-counter (dOTC) P2P platform.

Material by The Block

What else is known? The gold bars that are the collateral for NFTs are placed in the London-based vault of Brink’s, a custodial and transportation company. Swarm co-founder Timo Lehes noted that NFTs will provide owners with the highest and unparalleled level of transparency.

Overall, through this initiative, users will be able to capitalize on the flexibility of DeFi instruments while leveraging the value and liquidity of an asset from the traditional finance sector.

According to Lehes, the innovative potential of NFTs has been missed due to the hype surrounding this asset type in the previous bull cycle:

“Many equate NFTs with monkey-based JPEGs that were sold for millions of dollars, when in actual fact they have the means of onboarding billions of dollars of real and tangible assets onto blockchain.”

In the future, Swarm intends to expand its tokenized offerings by adding base metals, as well as entering the carbon credit market.

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According to the company’s website, the total value locked (TVL) of the Swarm protocol exceeds $14,6 million. In addition to gold, the platform currently offers tokenized shares of publicly traded companies and US Treasuries. Swarm launched its platform for tokenized RWAs late last year.

Swarm claims that its gold NFTs will not be affected by the Markets in Crypto-Assets (MiCA) regulation, which will come fully into force in the EU by the end of the year. The company clarified that the law’s rules do not apply to unique non-fungible crypto assets, including digital art and collectibles.

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