Market News: Tokenized Gold Market Tops $2.5B as Precious Metal Nears Record Highs

Key Takeaways:Tokenized gold market cap hit a record $2.57 billion, led by Tether’s XAUT and Paxos’ PAXG.XAUT supply surged by $437 million in August, while PAXG attracted $141.5 million inflows since June.Gold trades near $3,470 per ounce, close to April’s all-time high amid rising safe-haven demand.Tokenized gold market reaches record sizeThe market for gold-backed crypto tokens has surged to a record $2.57 billion, as demand for safe-haven assets rises with gold nearing its all-time high, according to data from CoinGecko.The two leading tokenized gold products — Tether Gold (XAUT) and Paxos Gold (PAXG) — have been the main drivers of growth, with both tokens seeing substantial inflows over the past few months.XAUT leads with $437M supply jumpXAUT, issued by Tether, the company behind USDT, expanded its market cap to $1.3 billion after a fresh minting of 129,000 tokens in early August on Ethereum, worth roughly $437 million, blockchain data from Etherscan shows.This marks XAUT’s largest single-month supply increase to date.PAXG inflows fuel $983M recordMeanwhile, PAXG, issued by U.S.-based Paxos, swelled to a market size of $983 million, per DefiLlama. The token has attracted $141.5 million in net inflows since June, pushing it close to the $1 billion milestone.Both tokens are fully backed by physical gold bars held in custody and designed to track spot gold prices.Gold nears April highs on safe-haven demandThe surge in tokenized gold demand comes as the spot gold price hovers near $3,470 per ounce, just below the record set on April 22 during heightened tariff tensions.Gold’s latest rally has been supported by safe-haven demand and a steepening U.S. Treasury yield curve, factors that traditionally increase investor appetite for both physical and tokenized gold.