Tether Gold Surges 40% on Central Bank and ETF Gold Accumulation Amid Macroeconomic Uncertainty

Tether Gold (XAUt) is experiencing a surge in demand as global central banks and exchange-traded funds (ETFs) accelerate their accumulation of physical gold amid macroeconomic uncertainty. The tokenized gold product, which offers direct exposure to physical bullion through blockchain technology, has seen its reserves grow to 7.66 tons of fine troy ounces by mid-2025, supporting over 259,000 XAUt tokens and a market capitalization exceeding $800 million [1]. This growth aligns with a broader bullion boom driven by central bank purchases and ETF inflows, reflecting heightened demand for safe-haven assets in an environment of geopolitical tensions and inflationary pressures.

The World Gold Council (WGC) reported that central banks added over 1,000 metric tons of gold in 2024, the third consecutive year of such accumulation, with most monetary authorities anticipating further increases in reserves [1]. This trend has continued into 2025, with gold ETFs recording $38 billion in inflows during the first half of the year, adding 397.1 metric tons of physical bullion to holdings. Analysts attribute this momentum to factors including U.S. President Donald Trump’s trade policies, which have heightened fears of economic instability, and resurgent inflationary pressures in the U.S., where the Federal Reserve expects prices to rise in the second half of 2025 [1].

XAUt’s price performance mirrors that of physical gold, which trades near $3,400 per troy ounce. Over the past 12 months, the token’s value has risen by 40%, according to Bloomberg data, offering investors a digital alternative to traditional gold ownership. By tokenizing bullion, Tether addresses logistical challenges associated with physical storage while maintaining the asset’s intrinsic value. The product’s appeal lies in its combination of portability, divisibility, and redeemability—features akin to Bitcoin—while retaining gold’s status as a hedge against currency devaluation and geopolitical risk [1].

Institutional adoption of XAUt has expanded through partnerships with major crypto exchanges, including Bybit, Bitfinex, BingX, and KuCoin. The token’s recent launch on Thailand’s Maxbit platform and its omnichain version on The Open Network (TON) further underscore its growing accessibility. This institutional-grade infrastructure positions XAUt to benefit from cross-border investment flows, particularly in markets where physical gold ownership is constrained by regulatory or logistical barriers [1].

Analysts highlight the strategic shift in central bank behavior as a key driver of XAUt’s growth. Christopher Gannatti of WisdomTree noted that for decades, central banks were net sellers of gold, but recent years have seen a reversal as institutions prioritize diversification of foreign exchange reserves. Gold’s borderless nature and historical role as a store of value make it an attractive asset in a world of currency volatility and geopolitical uncertainty [1].

The convergence of traditional and digital asset markets is evident in Tether’s approach, which leverages blockchain to enhance transparency and liquidity for bullion. This innovation aligns with broader regulatory clarity in key jurisdictions, reducing barriers to adoption for institutional investors. As central banks and ETFs continue to prioritize gold in portfolio diversification, XAUt’s role as a digital proxy for bullion is likely to expand, particularly in emerging markets seeking alternatives to dollar-dominated assets [2].

Source: [1] [Tether Gold rides bullion boom as central banks, ETFs rush to accumulate] [https://cointelegraph.com/news/tether-gold-xaut-market-cap-gold-rally-2025] [2] [BTCUSD - Tether Gold rides bullion boom as central ... - ADVFN] [https://mx.advfn.com/bolsa-de-valores/COIN/BTCUSD/crypto-news/96502646/tether-gold-rides-bullion-boom-as-central-banks-e]