Gold has been an amazing performer this 12 months. Throughout its 2025 rally, the gold value has damaged the $3,000 and $4,000 milestones for the primary time in historical past.
The dear steel is up roughly 60% since January 1, 2025.
Gold vs. Bitcoin
Bitcoin, which many argue is gold’s digital counterpart, hasn’t been doing so sizzling. In the identical timeframe, the worth of the biggest cryptocurrency declined by 5%.
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In mild of this, it’s fairly ironic that the very expertise Bitcoin pioneered is now getting used to make funding publicity to gold extra accessible than ever.
What’s Tether Gold (XAUT)?
Gold-backed crypto tokens like Tether Gold (XAUT) permit anybody throughout the globe to immediately add gold to their portfolio (with some caveats that we’ll clarify later).
XAUT is a gold-backed token issued by Tether, which additionally points the world’s largest stablecoin, USDT. Conceptually, XAUT is much like the dollar-pegged stablecoins crypto traders are already carefully accustomed to. Every XAUT token in circulation is backed by one nice troy ounce of gold held by Tether.
XAUT is offered as an ERC-20 token on the Ethereum blockchain, and might be purchased on quite a lot of centralized exchanges and DEXes.
The tokens might be instantly redeemed for bodily gold, however that is solely related for a small variety of traders in observe. It is because you should have 1 gold bar’s price of XAUT tokens to redeem your tokens instantly for bodily gold. Tether says purchasers who need to redeem for bodily gold ought to deposit no less than 430 XAUT ($1.8 million at present costs).
Tether launched XAUT in 2020, shortly after Paxos launched PAXG in September 2019. On the time of writing, XAUT tokenizes roughly $2.1 billion price of gold. The second-largest gold-backed token, PAXG, will not be too far behind with a market cap of $1.4 billion.
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It’s price highlighting that Tether is among the many 30 largest gold holders on the planet, and owns roughly 116 tons of the valuable steel. Nonetheless, solely a portion of those reserves is getting used to again XAUT, as the quantity of tokens in circulation corresponds to about 16.2 tons of gold (1,329 gold bars).
Why are traders selecting XAUT?
XAUT is likely one of the best methods to get publicity to gold as an funding, particularly if you’re already within the crypto ecosystem. All you want is an Ethereum-compatible pockets with some funds, and you should buy XAUT inside seconds on a DEX like Uniswap.
When shopping for XAUT on Uniswap, I had the identical sort of “aha second” that I first bought once I simply bought began with crypto. The conclusion that I simply added some gold to my portfolio in seconds with out KYC or different tedious processes jogged my memory that blockchain does certainly allow some very cool issues already, regardless of the neighborhood continuously lamenting the shortage of adoption.
You’ll be able to, in fact, additionally promote XAUT as simply as you should buy it, which is rather more handy than the method of promoting bodily gold. This makes it one of the extremely liquid strategies of getting publicity to gold. The marketplace for XAUT is open 24/7, and anybody throughout the globe can entry it immediately because of decentralized exchanges.
One other benefit of XAUT is its divisibility. With XAUT, you may get publicity to as little as 0.000001 ounces of gold, making it really accessible to everybody.
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What to remember when shopping for gold-backed tokens like XAUT
Whereas gold-backed tokens like XAUT are a particularly handy solution to spend money on gold, holding them isn’t fairly the identical as holding bodily gold.
Most significantly, these tokens include counterparty danger. Gold-backed tokens are finally based mostly on belief within the issuer (for instance, Tether for XAUT) to take care of the gold reserves, hold them correctly secured, and honor redemptions. If the custodian fails financially, acts dishonestly, or can not entry the bullion, the tokens might drop in worth, or you might not be capable of recuperate that worth in any respect.
On prime of that, the on-chain infrastructure introduces its personal set of dangers: hacks, technical flaws, or sensible contract malfunctions may lock you out of your tokens or trigger the token provide to float from what’s truly held in reserve.
Changing tokens again into bodily gold or money isn’t at all times simple. Redemptions can include minimal thresholds, additional prices, and geographic or authorized constraints, and in unstable situations, the issuer might pause or gradual redemptions. In the meantime, proudly owning bodily gold offers you direct management as you’ll be able to retailer it your self and promote it everytime you select.
On this article, we largely centered our consideration on XAUT, because it’s the most well-liked gold-backed token. Nonetheless, it’s price mentioning that PAXG is functionally very related, and the selection between the 2 actually simply comes all the way down to which issuer you belief extra (Tether or Paxos).
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What’s subsequent for gold: Traders anticipate new value information in 2026
Gold in 2025 has lived as much as its status as a “protected haven” and has confirmed to be one of the profitable investments. Its rise was pushed by a uncommon mixture of things: decrease rates of interest and actual yields, heightened geopolitical and commerce uncertainty, a noticeable weakening of the U.S. greenback, and regular demand from central banks.
The algorithmic gold value forecast from CoinCodex, which is predicated on the asset’s value historical past, volatility, and broader market traits, anticipates that gold will proceed rallying all through 2026 and hit a peak at round $6,400.
Whereas this forecast is extraordinarily bullish, CoinCodex isn’t alone in projecting that the gold value will proceed to hit new all-time highs in 2026.
Main funding financial institution Goldman Sachs just lately performed a survey of 900 institutional investor purchasers, and 36% of them predict that gold will hit $5,000 in 2026. In the meantime, 33% of the respondents offered a extra conservative prediction that gold will attain between $4,500 and $5,000, which might additionally end in new all-time highs (the present document is at round $4,377).
Daan Struyven, head of commodity analysis at Goldman Sachs, has offered a $4,900 value goal, citing central financial institution demand and continued Fed charge cuts as key drivers that may result in larger gold costs.
In the meantime, analysts at each JPMorgan and HSBC anticipate the gold value to surpass $5,000 subsequent 12 months.