Tether Gold Dominates Tokenized Gold Market with $4B Valuation

Tether Gold (XAU₮) has cemented its position as the leader in the tokenized gold-backed stablecoin market, surpassing $4 billion in valuation and capturing 60% market share. The sector's total capitalization surged from $1.3 billion to over $4 billion in 2025, reflecting growing institutional demand for digital gold products amid macroeconomic uncertainty.

The stablecoin's dominance stems from its transparent 1:1 gold backing, with 520,089 fine troy ounces of physical bullion stored in secure vaults supporting circulation. Over 409,000 XAU₮ tokens were sold in 2025, while Tether Gold Investments increased its gold reserves by 27 metric tons in Q4 alone.

Market analysts attribute this growth to three converging factors: record-high gold prices, geopolitical instability driving safe-haven demand, and institutional adoption of blockchain-based gold products. Tether Gold's infrastructure provides the liquidity and auditability traditional gold markets often lack.