A Hamburg warehouse holds 25 tonnes of refined copper, and buyers can now pick up a kilogram of it as a blockchain token. The batch is small: its total value at launch is roughly $366,000, which is far too little to move any market.
Uranium, gold, cobalt and nickel tokens are already on sale through Metals.io. The newest addition is xCu, a set of 25,000 copper tokens, with one kilogram of refined metal behind each token.
A deliberately small first batch
Over the coming year, the company hopes copper becomes a multimillion-dollar product. The opening batch stays small for now.
“We’d like to reach the millions of dollars, but we’re deliberately starting small to test the water and build sustainably,” said Ben Elvidge, head of alternative assets at Trilitech. Elvidge also runs Metals.io, whose trading platform and technical infrastructure were built by Trilitech, a Tezos development company based in London.
Further copper issuance will depend on how much demand investors show, according to Elvidge.
The metal is already mined
Retail investors usually get copper exposure through futures contracts or mining stocks. With xCu, the holder has a claim on physical copper sitting in storage. The tokens have no minimum investment and can be traded at any hour, Elvidge said.
“An xCu holder owns a portion of branded copper cathodes located in Hamburg, Germany,” he said. “This is real, physical, refined copper, not unmined copper or concentrate still in the ground.”
The comment is a shot at Bridgetower’s $11 billion copper-gold tokenization project in Arizona, which rests on mineral resources that haven’t been extracted. The metal Metals.io sells has already been mined, refined and put on a shelf.
Getting the copper out takes more work
Token holders can exchange their tokens for physical copper, though conditions apply. They need an appropriate storage account and must clear identity and anti-money laundering (AML) checks.
Size is also a factor. A single sheet of refined copper weighs around 125 kilograms, and Elvidge said that is the minimum for physical redemption. Someone with 10 tokens owns 10 kilograms of copper on paper but can’t take delivery of any of it.
The trustee is Archax, a regulated digital asset platform headquartered in the U.K. with operations in the U.S., EU and the United Arab Emirates (UAE). It verifies that the copper held in storage matches the number of tokens in circulation.
Ahead of three other Metals.io products at launch
The Metals.io platform lists five other tokenized metals products. Uranium leads with a market capitalization of about $9.2 million, and gold follows at $4.1 million. At launch, copper is worth more than the platform’s nickel, cobalt and rare-earth products put together.
Tokens backed by metal have been around for a while. Tether’s XAUT and Paxos’ PAXG both offer tokens tied to physical gold. Blockchain-based investment products tied to copper are a far smaller market.
Metals.io expects demand to come. Electric vehicles, power grids and AI data centers are all forecast to drive copper use higher, and S&P Global projects that global demand could climb 50% by 2040. The company has started with 25 tonnes in storage to see whether buyers show up.