Gold-Backed Cryptocurrencies Surge 24.15% Amid Trade War Uncertainty

Gold-backed cryptocurrencies have seen a significant surge in value this year, with Paxos Gold (PAXG) and Tether Gold (XAUT) rising by 24.15% and 23.7% respectively, reaching new all-time highs above $3,300. This performance closely mirrors that of spot gold, although their prices have since slightly receded to $3,265 and $3,244 respectively.

This surge in gold-backed cryptocurrencies contrasts with the broader cryptocurrency market, which has been in a downtrend. Bitcoin (BTC) has lost more than 11% of its value so far this year, while the wider crypto market has fallen by a little over 30%, based on the CoinDesk 20 (CD20) index.

The rise in gold-backed cryptocurrencies can be attributed to investors seeking refuge from the uncertainty induced by the escalating U.S.-China trade war. These tokens, backed by physical gold and tracking its price, have experienced a surge in value as investors turn to gold as a safe-haven asset.

This trend is reflected in the broader gold market, where inflows into gold ETFs hit 226.5 tonnes in the first quarter of 2025, the highest level since early 2022. Nearly 60% of that demand came from North America, indicating a strong appetite for gold as a safe-haven investment.

Similarly, gold-backed cryptocurrencies saw net token minting of over $42.7 million in the first quarter of the year, contributing to gold’s price appreciation and raising their total market capitalization near $1.4 billion. This highlights the growing interest in digital assets that offer the stability of gold combined with the flexibility of cryptocurrencies.