Bitcoin News Today: Gold-Backed Cryptos Outperform Amid Market Turmoil and Zero Fees

Risk-off sentiment returned in the financial market on Monday, pushing gold and gold-backed cryptocurrencies higher. Spot gold climbed 0.20% to $3,372.88 per ounce, having briefly touched $3,380 earlier in the day. This upward movement extended to Tether Gold (XAUT/USD) and PAX Gold (PAXG/USD), which both rose by 0.23% over the past 24 hours, securing their positions as the market's top performers during that period. As a result, these gold-backed tokens have recorded cumulative returns of over 28% in 2025, aligning closely with the performance of physical gold [1].

The gains in gold-backed tokens stand in stark contrast to the sharp declines in major cryptocurrencies such as Bitcoin (BTC/USD) and Ethereum (ETH/USD). Over the past 24 hours, Bitcoin fell 3.23%, while Ethereum dropped 7.77%. These declines erased recent gains and were exacerbated by comments from Federal Reserve Chair Jerome Powell at the Jackson Hole Economic Symposium, which introduced uncertainty into the market [1]. The broader stock market also experienced a downturn, with indices such as the Dow Jones Industrial Average and the S&P 500 closing lower, reflecting a broad-based risk-off environment.

Gold-backed cryptocurrencies, like Tether Gold and PAX Gold, are increasingly viewed as a safer alternative to traditional cryptocurrencies. These tokens are directly tied to the price of physical gold and are backed by real assets, making them less susceptible to the extreme price swings that characterize the broader crypto market. Tether Gold and PAX Gold are both traded at prices of $3,370.03 and $3,363.24, respectively, as of the latest updates [1]. This stability is a key factor driving investor interest in these tokens during periods of market turbulence.

PAX Gold, in particular, offers investors a cost-effective and transparent way to hold gold-backed digital assets. Paxos, the issuer of PAXG, does not charge ongoing custody fees for holding the gold that backs the token, unlike traditional vault storage and gold ETFs such as GLD, which have annual fees. This approach eliminates the erosion of balances over time for long-term holders. Additionally, PAX Gold does not impose on-chain transfer fees, allowing users to move their tokens freely without incurring additional costs [2].

The absence of holding fees makes PAX Gold particularly appealing to investors seeking to maintain exposure to gold without incurring the expenses associated with traditional storage methods. Compared to Tether Gold, which charges a flat 0.25% fee on both buy and sell transactions, PAX Gold offers a more competitive fee structure for large transactions. This cost advantage, combined with its alignment with physical gold prices, has contributed to its growing adoption [2].

While PAX Gold and Tether Gold do not generate inherent yields like traditional cryptocurrencies, the broader crypto ecosystem offers opportunities to generate returns through lending, staking, and liquidity provision. Platforms such as Nexo and YouHodler have provided yields on PAX Gold deposits, with rates ranging from 3-8% annual percentage yield (APY) [2]. These opportunities, however, come with risks such as counterparty risk in centralized platforms and smart contract risk in decentralized finance (DeFi) protocols.

The resilience of gold-backed tokens in the face of broader market declines underscores their role as a safe-haven asset in the crypto space. As traditional markets experience volatility, investors are increasingly seeking stability through assets like PAX Gold and Tether Gold, which reflect the steady performance of physical gold. This trend is expected to continue as market participants reassess their portfolios in response to macroeconomic uncertainties [3].

Looking ahead, the performance of gold-backed tokens in 2025 will likely be influenced by broader economic factors, including interest rates, inflation, and global geopolitical events. While Bitcoin and Ethereum have historically been leaders in the crypto market, their recent volatility has highlighted the advantages of assets like gold-backed tokens, which offer a more predictable price trajectory. Analysts suggest that gold prices are likely to remain strong in 2025, which could further bolster the performance of these tokens [3].

Source:

[1] title1 (https://www.benzinga.com/crypto/cryptocurrency/25/08/47323631/bitcoin-ethereum-plunge-defied-by-these-gold-backed-cryptos-today-this-is-how-much-tether-gold-and-pax-gold-have-gained-in-2025)

[2] title2 (https://www.thestandard.io/blog/pax-gold-paxg-digital-golds-safe-haven-in-the-2025-crypto-storm-10)

[3] title3 (https://investorshangout.com/understanding-the-rise-of-goldbacked-cryptos-amid-market-fluctuations-372604-/)