Catenaa, Thursday, December 25, 2025-Gold-backed stablecoins have reached over $4 billion in market capitalization, nearly tripling from around $1.3 billion at the start of 2025, reflecting growing onchain demand for tokenized precious metals, The Block reported.
XAUt leads the sector with roughly $2.2 billion, representing 50% of the total market, followed by Paxos Gold (PAXG) at $1.5 billion.
The two protocols together account for nearly 90% of tokenized gold holdings. XAUt recently overtook PAXG after aggressive supply expansion throughout 2025.
The growth in gold-backed stablecoins coincides with a 66% year-to-date rise in gold prices, driven by macroeconomic uncertainty, geopolitical tensions, and persistent global demand.
Tokenized gold provides investors fractional ownership of physical gold bars stored in secure vaults, combining traditional safe-haven exposure with onchain accessibility.
Tether has emerged as a major institutional participant, acquiring 26 tons of gold in the third quarter alone, surpassing purchases by most individual central banks.
By the end of September, Tether held approximately 116 tons, placing it among the top 30 global gold holders according to IMF data, ahead of countries including Greece, Qatar, and Australia.
The trend underscores increasing investor interest in combining crypto infrastructure with conventional hedging assets, allowing liquidity, transparency, and cross-border access while maintaining exposure to gold’s value.
