Core Viewpoint - Tether has rapidly become a significant player in the global gold market, accumulating around 140 tons of gold valued at approximately $24 billion, positioning itself similarly to a central bank in its gold strategy [1][4][6]. Group 1: Gold Accumulation and Market Impact - Tether purchased over 70 tons of gold last year, surpassing most central banks except Poland, which added 102 tons [2]. - The company's gold purchases have contributed to a 65% rally in gold prices last year, indicating its role as a significant new buyer in the market [12]. - Tether's buying rate is about one to two tons per week, with plans to continue this pace for the foreseeable future [8][10]. Group 2: Strategic Positioning and Future Plans - Tether aims to compete with major banks in gold trading, seeking to establish itself as a leading trading entity in the gold market [14][15]. - The company has hired senior gold traders from HSBC to enhance its trading capabilities and explore market inefficiencies [16]. - Tether is also investing in royalty companies related to gold mining, diversifying its exposure in the gold sector [18][19]. Group 3: Geopolitical Context and Market Sentiment - Tether's CEO predicts that geopolitical rivals to the US dollar may launch gold-backed alternatives, reflecting a broader distrust in government debt [4][20]. - The company's strategy aligns with emerging market users of its dollar stablecoin, who view gold as a protective asset against currency debasement [20][26]. - Tether's gold strategy has gained traction amid a significant market rally, as investors seek alternatives to holding US dollars [23][26].

Tether’s legacy was built around the U.S. dollar, but an attestation report published by the stablecoin issuer on Monday underscored a recent shift in momentum toward gold—with the report coming right as gold hit a new all-time high above $5,100. As of Dec. 31, the company had minted 375,000 Tether Gold (XAUT) tokens, a 38% increase compared to three months ago, according to a report from accounting firm BDO Italia. Meanwhile, USDT’s market cap grew 7% to $187 billion, according to CoinGecko. That means XA ...

Core Insights - In decentralized finance (DeFi), traders previously lacked options during market downturns, primarily relying on stablecoins for liquidity [1] - The recent sell-off in the crypto market on October 10, 2025, resulted in $19 billion in long positions being liquidated, yet stablecoins only saw a modest 2% increase in market cap to over $303 billion [2] - The on-chain commodities sector, particularly tokenized gold, has shown significant growth, with a 27% increase in October alone, contrasting with the overall crypto market decline [3] Market Trends - The on-chain gold sector's market capitalization rose from $2.4 billion to over $2.6 billion between October 9 and October 13, 2025, and has increased from $1 billion at the start of the year to over $3 billion [4] - Gold prices have surged dramatically, from $2,624.49 per troy ounce on January 1 to $4,065.81 on November 18, driven by global political instability and a weakening U.S. dollar [5] - DeFi investors, typically known for higher risk tolerance, are increasingly investing in gold, which is stabilizing the market amid the broader crypto downturn [6]

Market Overview - Tokenized gold market capitalization has exceeded $42 billion [1] - The tokenized gold market has grown by 147% in six months [1] Market Share - Tether's XAUT and Paxos' PAXG control approximately 90% of the tokenized gold market [1]

Market Growth & Adoption - Tokenized gold market size has grown 3x since the beginning of 2025 [1] - Tokenized gold could be an effective way to onboard new users into crypto [1] - Many people will move a portion of their physical gold on-chain as advantages become widely known [1] Advantages of Tokenized Gold - Tokenized gold solves almost all problems associated with storing and trading physical gold [1] - Tokenized gold price tracks the global spot price almost perfectly [3] - Tokenized gold offers deep liquidity supported on major CEXs [3] - Tokenized gold eliminates counterfeit risk and physical theft, only wallet/private-key risk remains [3] DeFi Integration - Tokenized gold brings DeFi to the asset class, enabling yield-generating and borrowable collateral [2] - Projects like @Paxos and @Theo_Network are building gold 3.0 to turn it into yield-generating, borrowable collateral [2] - DeFi craves deep, trusted liquidity, and tokenized gold is the perfect candidate [2] Disadvantages of Physical Gold - Domestic gold prices often have huge premiums over the global spot [3] - Physical gold has very high buy/sell spreads [3] - Physical gold has good day-to-day liquidity but heavy slippage [3] - Widespread counterfeit gold exists [3] - Risk of theft or loss exists [3]

Market Trends - The tokenized gold market has experienced significant growth, reaching $36 billion in market capitalization [1] - Tokenized gold market has increased 50x since 2021 [1] - Tether is capitalizing on the USD to onchain transition with USDT [1] - Approximately $30 trillion of gold may migrate onchain [1] Key Players - Tether's XAUT and Paxos' PAXG dominate the tokenized gold market [1] - Paolo Ardoino & Co are key figures related to Tether [1] Tokenization - Tokenized commodities are gaining traction [1] - Tokenized gold is seen as a battle-tested inflation hedge [2]

Core Insights - Tether holds over 11.6 tons of gold bars to back its tokenized gold offering, Tether Gold (XAUT), in response to increasing investor demand for gold [1] - As of September 30, XAUT was backed by more than 375,000 ounces of physical gold, with reserves stored in Switzerland [1] - The market capitalization of XAUT surged to over $1.4 billion in Q3, driven by rising gold prices amid inflation concerns and geopolitical instability, and reached $2.1 billion in October as gold prices hit $4,500 [2] Group 1 - Tether Gold (XAUT) is issued under El Salvador's digital asset framework and is backed 1:1 by a fine troy ounce of gold [1] - The growth in XAUT's market cap was primarily fueled by increased demand from retail investors in emerging markets, as stated by Tether's CEO [2] - Tokenized gold provides a blockchain-based representation of physical gold, making it accessible to investors without the complexities of traditional custody or logistics [3] Group 2 - The rising demand for gold is attributed to inflation concerns, geopolitical instability, and increased purchases from central banks [2] - Tokenized gold allows investors who lack access to traditional financial products like ETFs to invest in gold [3]

Market Trends - Tokenized gold trading volume reached $1 billion for the first time since the 2023 banking crisis [1] Investment Analysis - The report compares $XAUt and $PAXG, analyzing how blockchain is reshaping gold investment [1] Risk Assessment - The report breaks down the potential risks associated with tokenized gold investment [1]

Market Performance - Tokenized gold reached a new all-time high market cap of $328 billion [1] - Tokenized gold market cap rose 21% in 24 hours [1]

Tokenized Gold Supply - The supply of tokenized gold on Ethereum has increased by over 100% since the beginning of the year [1] - Tokenized gold supply is approaching $2.7 billion [1]