Tether Gold grows alongside demand for digital gold
The market capitalization of the gold-backed Tether Gold (XAUT) token has increased by approximately 200% over the past year. At the same time, the number of its holders has grown more than tenfold, while Tether continues to increase the supply of XAUT amid strong demand for cryptocurrencies backed by the precious metal.
On the night of September 29, Tether issued around 119,000 new XAUT tokens worth approximately $494.57 million in total. The issuance was roughly 17% of XAUT's market capitalization at the time.
One XAUT is worth around $4.16 thousand. The token tracks the market price of gold: each XAUT is backed by one troy ounce* of physical gold.
* Troy ounce is a standard unit of mass used in the global precious metals market. One troy ounce equals approximately 31.1035 grams. Exchange prices for gold, silver, platinum, and palladium are usually quoted in troy ounces.
XAUT market capitalization has grown by 200% in a year
Tether Gold's market capitalization currently stands at approximately $2.85–2.86 billion. For comparison, a year ago XAUT's market capitalization was around $952 million. Thus, the figure has increased by approximately 200% over the past 12 months.
Tether Gold's main competitor remains PAX Gold (PAXG), a token issued by Paxos. Its market capitalization currently stands at around $1.8 billion, compared with $1.13 billion a year earlier — an increase of approximately 64%.
The XAUT holder base has changed even more significantly. In September last year, the token was held in approximately 11,600 accounts, while the number of holders now exceeds 137,000. Thus, the figure has increased more than tenfold over the past year.
The number of PAXG holders has also increased, but by a significantly smaller amount: from approximately 55,000 to 88,000 over the same period — up 60%.
Tether's gold reserves
The growth of XAUT has been accompanied by an increase in Tether's physical gold reserves.
At the end of the first quarter of 2026, the amount of gold backing Tether Gold reached 707,747 troy ounces — around 22 metric tons. This was 36% more than at the end of 2025, when reserves stood at 520,089 ounces, or approximately 16.2 metric tons. As of the end of March 2026, the market value of this gold exceeded $3.3 billion.
In the second quarter of 2026, the physical volume of reserves remained at around 22 metric tons. They included 1,759 London Good Delivery* bars, as well as smaller gold bars. The gold is stored in Switzerland.
* London Good Delivery is an international standard for gold and silver bars used in the professional precious metals market. Requirements for such bars are established by the London Bullion Market Association (LBMA). The standard defines acceptable weight, fineness, dimensions, markings, and manufacturer requirements. Good Delivery gold bars typically weigh around 400 troy ounces, or approximately 12.4 kg, and must have a minimum fineness of 995 parts of gold per 1,000. Compliance with this standard allows the bars to circulate freely among major banks, vaults, and other participants in the international gold market.
At the same time, the gold backing XAUT represents only part of Tether's total precious metal holdings. The company also uses gold as part of USDT reserves and for investment purposes. At the end of the second quarter of 2026, Tether's total gold holdings exceeded 146 metric tons.
Trading activity around XAUT and PAXG
The largest trading volume in gold stablecoins is concentrated on the Binance crypto exchange.
Over the past 24 hours, trading volume in the XAUT/USDT pair on the exchange amounted to approximately $57.7 million, while total daily XAUT trading volume stood at around $308 million.
The figures are lower for PAXG: the PAXG/USDT pair on Binance accounted for approximately $18.4 million out of a total trading volume of around $205 million.
The growth in market capitalization and the number of holders of tokenized gold shows that investor interest is extending not only to the precious metal itself but also to its digital counterparts. Such tokens allow investors to gain exposure to a traditional asset — physical gold — while benefiting from cryptocurrency infrastructure, including the ability to trade and transfer assets around the clock.
Bitcoin strengthens relative to gold
Despite the growing popularity of gold-backed tokens, the performance of gold itself in recent months has differed significantly from that of Bitcoin.
Bitcoin has gained more than 40% during the current quarter, while gold corrected by approximately 6% in September and fell to an almost two-month low of around $4.16 thousand per troy ounce.
To compare the two assets, the BTC/Gold Ratio is often used — the number of troy ounces of gold required to purchase one Bitcoin.
One Bitcoin is currently worth approximately 20.33 ounces of gold. This is around 49% below the peak of approximately 40 ounces reached in December 2024. However, compared with the beginning of the third quarter of 2026, when the figure stood at 14.88 ounces, the ratio has increased by approximately 36%.
Thus, over the past three months, Bitcoin has strengthened significantly relative to gold, although over the longer term the ratio remains well below its historical peak.
At the same time, XAUT's growth shows that demand for gold and demand for Bitcoin are not necessarily mutually exclusive. Investors can use both assets for different purposes: Bitcoin remains a more volatile digital asset, while tokenized gold provides access to a traditional precious metal through blockchain infrastructure.