Tether, the crypto company responsible for the largest stablecoin USDT, possesses over 11.6 tons of gold bars to support the value of its tokenized gold offering, driven by increased investor interest in gold.
, issued by TG Commodities under El Salvador’s digital asset framework, is secured by over 375,000 ounces, approximately 11.6 tons, of physical gold as of September 30. Each token corresponds to a fine troy ounce of gold, with reserves maintained in Switzerland, according to the company’s statement.
XAUT’s market capitalization surged past 1.4 billion in the third quarter as gold reached new peak levels amid inflation worries, geopolitical uncertainty, and increasing demand from central banks. The token’s growth continued into October, peaking at $2.1 billion as gold hit a $4,500 high.
This market cap increase was primarily fueled by rising demand from retail investors in emerging markets, as stated by Tether CEO Paolo Ardoino in a CoinDesk interview last week.
Tokenized gold provides investors with a blockchain-based representation of the physical asset within a crypto wallet, sidestepping the challenges of custody and logistics associated with holding bullion. It also grants access to gold for investors lacking availability to conventional derivative financial products like exchange-traded funds (ETFs) or gold accounts.
Read more: Tether Eyes Fresh Investments to Push USAT Stablecoin to 100M Americans at December Launch
