Paxos Labs Launches PAXGy Token Allowing Holders to Earn Returns in Gold
Paxos Labs has launched PAXGy, a token backed by PAXG that can increase in value relative to gold over time. The underlying reserves are deployed to vetted institutional borrowers through the gold-leasing market.
PAXGy is live across platforms including OKX, X Layer, Uniswap, 0x and Ether.Fi, but the return is not guaranteed.
The token balance stays the same while its gold value can grow. PAXGy adds another layer to the existing tokenized gold market, which has grown beyond $5 billion in total value, with trading volume during the first quarter of 2026 exceeding the whole of 2025.
Paxos Labs says holders can deposit PAXG or swap supported stablecoins for PAXGy. The reserves backing PAXGy can then be lent to vetted institutional borrowers in the bullion market, when those strategies generate a return, that value accrues through the PAXGy exchange rate.
The holder's number of tokens does not have to increase. Instead, each PAXGy can become redeemable for more PAXG over time. That is a very different model from simply holding tokenized bullion.