Gold and silver just overtook U.S. Treasuries as the reserve asset central banks hold the most of.

We built STRATO before this happened, but we were guessing it would.

Gold and silver are the most trusted assets, and people are turning to them more and more as the world gets weirder.

But they're hard to use: as assets and as money. So they also have the most to gain from tokenization. That's the thesis for HardFi, and why we built it for exactly this moment.

＠kjameslubin explains more below:

"And so, when STRATO has become this big, huge thing, how does that change your average investor's relationship with dollars, gold, and savings? What is it going to mean?"

"Yeah, I mean, I think it will take some time to get there, but I think, okay — a really good gold token does a very good job at actually just being the money, right? It's the savings asset for half of the planet.

[But] It's not that transferable, it's not liquid, it's not providing financial access in the form that it should — whereas a gold token really does. So a lot has to happen between now and then, but I expect them to either be directly transacted at huge scale, or more likely routed through a U.S. dollar stable — we'll still somehow always settle in U.S. dollar equivalents, especially cross-border, still the biggest. And likely this will be exposed to the user through some kind of TradFi or fintech-y interface.

I think, in the end, we're kind of on the infrastructure layer of all this happening. But lots and lots of gold and silver — there's thirty trillion above ground, five billion is tokenized — the ratio with U.S. dollar stablecoins is much, much higher. And I think the benefits are higher for gold and silver.

Maybe you see a sort of defensive return to gold and silver right now — we're a little bit down from the recent all-time highs on both. Silver went absolutely insane, as did gold, but silver more so, as it wants to do. It's been a little bit quiet, comparatively. But the central banks have liked that they've continued to accumulate — a month plus ago, gold and silver overtook U.S. Treasuries as the reserve asset across all the central banks. And I think that speaks to a certain weirdness in the world — the world's changing rapidly, geopolitically, AI, tech broadly, et cetera. And people tend to retreat to safe-haven assets at that time.

You can imagine a sort of overall monetary restructuring happening in the next few years. Crypto will be a big part of it, but you have to look at the reality of it — gold's thirty trillion, Bitcoin's eclipsed two trillion at some point, ETH's gone over five hundred billion, something like that — so we just have to make peace with all the other assets in our fight for the money, with gold being the best candidate for sort of sovereign money that people are used to using."

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There's a huge tragedy when it comes to gold. You probably know what it is:

Most of the world's gold is sitting in a mattress, figuratively, and sometimes literally.

So, the world's most trusted asset is often also the least productive one. That's a huge problem and what STRATO founders ＠vic4wong and ＠kjameslubin set out to solve:

"Your gold — most of the gold in the world is mattress gold, and it does not really provide any financial inclusion unless you've got an account with a small number of players, and probably a lot of gold in a standardized format. But it's the default savings asset for sort of half the planet.

Similarly, if you're not an American, you can certainly get U.S. stocks, but sometimes it's difficult — there can be taxation, like if you own a good Canadian stock as an American, there's a fifteen percent transfer tax on dividends, that sort of thing. And even Europeans sometimes have a hard time — their brokerages are opinionated. The story I've heard is people trying to get into NVIDIA a few years ago, and their European brokers being like, 'yeah, it's a little too risky, that tech stuff — maybe you want some bonds or something.'"

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You can think of STRATO's USDST as a version of the USD before 1970:

Gold-backed
But more spendable than gold

Except that USDST is now offering 8% APY through the USDST Savings Vault on https://t.co/CaZsoWnhtQ

"Yeah, okay. So the USDST Savings Vault is as follows:

USDST is a decentralized stablecoin, somewhat similar to USDs, which I mentioned earlier. You can actually create it yourself, in contrast to USDC or USDT — for those, it's a pretty gate-kept process to create a new token.

In our case, it's a protocol. The way it works, basically, is over-collateralized borrowing: you send ETH to the protocol, and you can draw down the stablecoin against it, up to a certain amount.

Similarly, you can directly mint it — which is kind of equivalent to a hundred-percent LTV, zero-interest — against popular stablecoins like USDT and USDC, and that also helps maintain it at about a dollar. So that's how the token gets into circulation.

The unique thing about it, compared to USDs, is it allows real-world-asset collateral — in particular gold and silver. So if you squint at it, you can combine the idea of the gold token, the silver token, and the dollar token — it starts to look a little bit like the U.S. dollar in the 1970s, being actually most like the gold token, but going from gold to the actual dollar denomination, more spendable in practice, at point of sale and so on.

The savings flavor — what you find is that for any emerging stablecoin, people go back to the biggest, most liquid stablecoin, so you find the price goes down or the supply shrinks, and then goes up and shrinks, and so on. What you want is the supply to increase but the price to hold. So the way we're doing that is the protocol redirects some of the borrow interest that happens when it's created — and other sources — into a savings flavor, whereby if, instead of converting it right away, you just lock it up, you earn, denominated in the token. And we have a little bit of STRATO rewards on top as well.

So that is a problem the savings vault is meant to solve for us — trying to balance out the outbound (USDST to USDC or ETH or what have you) and the inbound (liquid crypto to our stablecoin). Victor will show all that pretty soon."

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Season 3 turned $USDST into something exciting.

It's STRATO's native stablecoin, of course, backed mostly by gold. But now it has officially become an earning asset, with easily accessible yield through a savings vault, available to anyone with a few quick clicks.

"So yes, it's — but yeah, it's like it's USDST. It's not, you know, a huge-supply stable just yet — we've got maybe five million of it in circulation. It'll trade natively on STRATO soon, maybe some other venues too. But it's reasonably close to a dollar in formulation — at least that's the intent.

Yeah, well, it's pretty cool, because whereas USDST has existed for a while, it's really just been something you use on STRATO, and not necessarily very exciting — really more of a mechanism than anything. But now, with the vault, it's actually like an earning asset. It's really turned into something much more productive."

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8% on $USDST is high, but not too high.

＠kjameslubin explains why the APY number isn't the only thing that traders base their decisions on. A lot of it comes down to safety and sustainability.

Get started with the $USDST Savings Vault at https://t.co/CaZsoWmJEi

"Also, I would say that people get a different personality when the yields are too high.

Some of the bigger, more institutional players look at a really high yield, and they're like: something's wrong there; it can't be sustained. Whereas your more DeFi yield farmer might be excited by high yield — get in, and then get out in like three days or something.

So it's a little bit of an emphasis on sustainability. But also, again, the incentives have changed, so that you as a token holder don't actually want there to be a giant increase in the circulating supply of STRATO. So the staking flavor will help lock some of it up and so on. And as communicated before the auction, it's a hundred million, fixed. A bunch of it has been allocated in different buckets, but you don't want it all hitting at one time.

So the point of the points program is really now to make the system work as best as possible, and less about making sure lots of people hold the token and so on and so forth. So think of it more like a marketing budget. You know how we feel about marketing people — you want that budget as small as possible. We love all of our marketing people."

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Hard Money Weekly Digest | July 24th
This week's HardFi news in just 2 minutes

🏅 Gold: up +1.95%
🥈 Silver: up +5.52%

1. China ended retail paper gold trading: Today, ICBC, the world's largest bank by assets, along with Postal Savings Bank, Ping An Bank, and China Guangfa Bank, halted retail leveraged paper gold and silver products linked to the Shanghai Gold Exchange, a wind-down the banks announced in late June.

Physical gold, accumulation plans, gold ETFs, and institutional exchange trading all stay open. The change strips leverage and synthetic claims from retail hands and leaves the metal itself available to everyone.

1. Tokenized Gold Gets Its First Legal Home: Legal recognition is what turned tokenized treasuries into a financial instrument, and gold just got its first ruling of that kind.

On July 20, the Abu Dhabi Global Market recognized Tether Gold as an Accepted Spot Commodity, the first time a major financial center has defined tokenized gold in law. Regulated firms there can now custody, trade, and settle the token under local rules.

1. China's gold-buying streak reached 20 months: The People's Bank of China added about 15 tonnes in June, its largest monthly purchase since 2023, taking reserves to 2,346 tonnes. It bought straight through the drawdown, part of a reserve-diversification push running since November 2024.

2. Tokenized stocks got a licensed US route: On July 23, Ondo Finance's subsidiary Oasis Pro Markets secured FINRA authorization to offer tokenized equities, ETFs, mutual funds, and IPO-linked products to US institutional and retail investors under SEC and FINRA oversight. It is the first licensed path to put American shares on-chain for American buyers.

Until now, every tokenized-stock product had to route around the US retail market.

1. The London Stock Exchange Moves to Copy On-Chain Markets: A 300-year-old exchange rebuilding itself for round-the-clock trading, copying tokenized markets.

Plans surfaced July 20 for a separate overnight venue running 5:00pm to 7:50am London time, targeted for the first half of 2027 and starting with more than 2,600 exchange-traded products. Gold and silver already trade that way on STRATO.

1. Tokenized RWAs pulled back to $34.7 billion: Tracked on-chain value of tokenized real-world assets slipped to $34.67 billion on July 22 from a peak of $35.2 billion, even as Wall Street firms kept expanding their on-chain offerings. Treasuries remain the largest slice at $15.9 billion, with commodities at $8.3 billion, led by tokenized gold. The pullback landed the same week the products kept multiplying, which reads like consolidation rather than retreat.

RWAs keep accelerating. Tokenization is inevitable...and accelerating.

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Most of the world saves in gold, but most gold holders also just keep it "under their mattress," so to speak.

This is the STRATO unlock:

→ physical gold or silver
→ tokenized
→ instantly tradable
→ borrow $USDST against it
→ use the USDST to earn more on STRATO
→ OR use it in the real world

STRATO turns gold from being something hidden away to gather dust into an asset that can work for you in the market. Be your own gold-backed bank.

That's the magic of $GOLDST + $USDST on https://t.co/sxsrZTh4lW:

"What's special about USDST?"

"To our knowledge — I think I've seen some announcements like this — it is very notable that you can create it against gold and silver.

So if you think about the amount of above-ground gold in the world, it's about thirty trillion. It's less the case in the West, but it's the default savings asset for much of the planet — most of the planet, maybe half. And so people have a lot of it. But the problem with it is it's often like a mattress asset: it's not providing you any real financial inclusion unless you're capable of navigating pretty big institutions who will give you decent to good terms on it — maybe if you want to borrow or trade it and so on.

But your average mattress gold holder — it's just sitting there. It's not doing anything for you from a productivity perspective. So we think it's like a really big unlock.

And we've actually seen that even with folks who have pretty good access to US financial services — they've been excited to tokenize, get instant tradability of those tokens. The tokens can be much more liquid than the gold itself, in the sense that you can move them anywhere. It's still reflective of the underlying gold, but you can move the tokens over the internet and the gold sits somewhere.

And you can get the liquidity out of it from borrowing the stablecoin, too. And by the way, the rates can be extremely, extremely high — we heard recently that if you work with short-term gold lenders in, say, India, the interest rates are as high as twenty-five percent.

So this allows both an easy loan path and much better rates than you can get in a lot of different markets."

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