Tether Gold Soars as Global Institutions Fuel Bullion Demand

Tether Gold Soars as Global Institutions Fuel Bullion Demand

Digital Gold Sees $800M Backing Amid Record Central Bank Accumulation

Tether Gold (XAUt) is riding a powerful surge in global gold demand, with its backing now standing at 7.66 tons of fine troy ounces — a reserve supporting over 259,000 tokens and pushing its market cap beyond $800 million, according to a second-quarter attestation by BDO Italia.

The stablecoin, which tracks physical gold prices, is closely shadowing a bullish gold market that has climbed to nearly $3,400 per troy ounce. That represents a 40% year-on-year rise for XAUt, reflecting physical gold’s rally amid heightened economic and geopolitical turbulence.

Central Banks Break from Tradition, Hoard Over 1,000 Tons of Gold

According to the World Gold Council (WGC), central banks acquired more than 1,000 metric tons of bullion in 2024, marking the third consecutive year of record-breaking gold accumulation. Most central banks anticipate further growth in their reserves over the next 12 months.

“This is not normal,” wrote Christopher Gannatti, global head of research at WisdomTree. “For decades, central banks were net sellers of gold. Now they’re stockpiling it again.”

He added, “In a world of rising geopolitical risk and currency weaponization, gold is one of the few assets that travels well across borders and regimes.”

Gold ETFs See $38 Billion in Inflows as Institutions Pivot

Institutional investors are also racing to gold. In the first half of 2025, gold exchange-traded funds (ETFs) attracted $38 billion — the largest inflow in five years, translating to 397.1 metric tons of new physical bullion holdings.

Driving this momentum are fears over economic volatility, including persistent inflation, delayed rate cuts, and escalating geopolitical tensions.

Economist Peter Schiff has flagged inflation as a persistent threat, especially with tariffs pushing up prices for U.S. producers and consumers. The Federal Reserve, responding to this outlook, has indicated a delay in expected interest rate cuts.

Morningstar’s senior U.S. economist, Preston Caldwell, emphasized the shift: “We’ve delayed expectations of rate cuts in light of these inflationary trends.”

Tether Gold Brings Traditional Wealth to the Blockchain

Launched in January 2020, Tether Gold (XAUt) gives digital asset investors a way to own gold without leaving the blockchain. It combines the enduring appeal of gold with portability, divisibility, and redeemability.

The token is currently available on exchanges such as Bybit, Bitfinex, BingX, and KuCoin, and recently expanded to Thailand via Maxbit. Tether has also rolled out an omnichain version of XAUt on The Open Network (TON) via its USDT0 liquidity framework.

While Bitcoin is often dubbed “digital gold,” the current trend signals a return to the original store of value. As macroeconomic conditions worsen, gold — and by extension, gold-backed tokens — is once again becoming the go-to safe haven for wealth preservation.