- Tether Gold gained 40% in a year as global gold demand lifted prices to $3,400.
- The U.S. GENIUS Act mandates real reserves and audits, reshaping stablecoin issuance.
- Central banks bought over 1,000 tons of gold in 2024 in order to protect their reserves.
A volatile global economy has sparked record gold accumulation by central banks and institutions, lifting Tether’s gold-backed token, $XAUT. Reportedly, the stablecoin gained 40% in 12 months as global gold demand pushed its price to $3,400. As of press time, Tether has 259,000 tokens in circulation, backed by 7.66 metric tons of physical gold and a market cap exceeding $800 million.
This rise mirrors increasing global demand for tokenized, collateral-backed digital assets and positions Tether’s model in direct competition with U.S. dollar-pegged stablecoins like USDT and USDC. Such an upward trend could well have correlated with central banks’ behavior.
According to the World Gold Council, monetary authorities have acquired more than 1,000 metric tons of bullion in 2024, thus marking the fourth consecutive year of record purchases. These figures show a dramatic shift in monetary strategy. For decades, central banks were net gold sellers and are stockpiling at unprecedented levels, with the majority anticipating further accumulation into 2026.
In the midst of this gold rally, attention has been drawn to Tether Gold, wherein, its token XAU₮, is issued on a 1:1 basis against London Good Delivery-standard gold that is maintained inside a Swiss vault, under high security. Uses range from large institutions down to smaller retail users, with an ability to redeem tokens in units as small as 0.000001 ounces of gold.
Central Bank Demand Reshapes Tokenized Gold Market
According to the Global head of research at WisdomTree, Christopher Gannatti, the rising geopolitical risk and currency weaponization, gold is one of the few assets that travels well across borders and regimes. He further described the scale of gold stockpiling as a reversal of historic norms.
Tokenized assets are attracting investor interest beyond the traditional markets. More than $38 billion flew into the gold-backed ETFs in H1 2025, with 397 metric tons being added to the ETF holdings. This change has thus benefited tokenized alternatives such as XAU₮, which avoid the logistical headaches of owning bullion in the traditional sense.
The token, launched in January 2020, is now available on exchanges such as Bybit, Bitfinex, BingX, KuCoin, and, most recently, Thailand’s Maxbit. With seamless integration into crypto trading environments, Tether Gold bridges conventional stores of value with blockchain utility.
Related: Tether Gold Now Backed by 7.66 Tons of Physical Gold
GENIUS Act Opens Regulatory Path
With the model of Tether Gold gaining momentum, specific regulatory trends in the U.S. have new implications. Moreover, with the recent passing of GENIUS Act, it would require reserve requirements, AML vetting, financial disclosures, and cooperation with law enforcement. These initiatives reflect a change from permissive models to organized management.
Tether CEO Paolo Ardoino has confirmed plans to launch a new U.S.-based stablecoin, fully compliant with the GENIUS Act. According to Ardoino, the coin will be audited by a Big Four firm and serve both institutional and retail markets. He stated that with XAU₮, individuals and institutions around the world will have the ability to hold, transfer, and store gold-backed value with complete assurance, and no compromises on backing, compliance, or utility.
This action puts Tether in the position to traverse the U.S. regulatory waters and capitalize on the credibility of the asset-backed certificate. This change in direction, which has moved away from unbacked tokens to somewhat more transparent and tangible reserves, is part of a larger change. The new risk definition of institutions is stability and physical value and this momentum is likely to result in the coexistence of gold-backed models with the dollar-pegged tokens.
