Tether’s recent third-quarter report confirms that its Tether Gold (XAU₮) tokens are fully backed by 375,572 fine troy ounces of physical gold stored in Switzerland, valued at approximately $1.44 billion as of September 30. With about 522,089 XAU₮ tokens in circulation, the supply is verified.
Following this report, the market value of XAU₮ has exploded to a new record of $2.1 billion, more than double its value in August, driven by soaring gold prices.
Tokenization: The Future of Asset Ownership
Tether CEO Paolo Ardoino highlighted this growth, stating that XAU₮ proves that real-world assets (RWAs) can thrive on the blockchain without compromise. He sees XAU₮ as symbolizing the future of asset ownership, merging “physical security meets digital freedom.”
Analysts concur, noting that the combined market of Tether Gold and PAX Gold now accounts for roughly 90% of the $3.7 billion tokenized gold market, positioning XAU₮ as one of the blockchain’s most significant RWA products.
This shift toward tokenization is attracting institutional and regulatory attention. Hester Peirce, an SEC Commissioner, has indicated that tokenization is a key focus for the agency, emphasizing the importance of bringing traditional assets like stocks and Treasuries onto the blockchain.
The Gold Rally’s Pause and The “Debasement Trade”
The surge in tokenized gold is part of a broader “debasement trade” on Wall Street, where investors view gold and crypto as “assets of fear.” BlackRock CEO Larry Fink noted that investors see them as a safe haven against growing concerns about national debt and currency decline.
However, analysts are now warning that the gold rally may be coming to an end. After months of a “monster rally,” the price has fallen back below the $4,000 level from its record high of $4,400 per ounce. Experts suggest this is a consolidation period, not a total collapse, but that the “time out” for gold bullion and mining shares may last well into 2025.
Adding to the caution, Capital Economics forecasts that the surge, which they believe was driven by fear of missing out (FOMO), could lead to a “mini-bust,” causing gold prices to potentially fall back to $3,500 per ounce by 2026.
October 2025, Cryptoniteuae
