XAUT climbs to $2.85B market cap as gold slides 14%

Tether Gold's XAUT market capitalization reached $2.85 billion as customer holdings rose 9.5 percent during a quarter when gold fell 14.1 percent to close at $4,008 an ounce.

"Holders of Tether Gold are not only buying XAUT when the price of gold is rising. They are using periods of market weakness to increase their ownership of physical gold," Paolo Ardoino, chief executive officer at Tether, said in the company's quarterly attestation report.

Customer holdings added more than 53,000 XAUT during the quarter, representing ownership of an additional 1.66 tonnes of physical gold. Tether maintained 707,747 fine troy ounces of reserves, valued at $3.3 billion at the end of the first quarter. Gold's 14.1 percent decline marked its worst quarterly performance since the second quarter of 2013, TradingView data shows.

XAUT leads the tokenized commodity sector with a market capitalization near $2.85 billion, against a broader tokenized commodities market worth about $5.6 billion, DefiLlama data shows. Yet only 8 percent, or $230 million, of XAUT's market cap is deployed within DeFi, leaving the token's role as productive collateral largely untapped.

Can XAUT move beyond a defensive hedge?

The Q2 inflows reflect a broader shift toward tokenizing real-world assets. Unlike traditional bullion, tokenized gold combines physical ownership with continuous blockchain settlement, making it easier to trade, transfer, and integrate into decentralized finance. That flexibility becomes more valuable as investors seek stability without leaving the digital asset ecosystem.

The distributed tokenized commodities market fell 4.2 percent to $4.58 billion in the past 30 days, while the number of holders rose 6.5 percent to 253,000, RWA.xyz data shows. Tether Gold ranks as the largest distributed tokenized commodity product with $2.4 billion in total value as of Monday, ahead of rivals including Paxos Gold (PAXG).

XAUT received Shariah certification from Amanah Advisors in July, a move that could expand access to the token among Islamic financial institutions. Greater liquidity, stronger collateral use, and clearer regulation could accelerate broader portfolio adoption. Until then, tokenized gold is likely to remain a trusted hedge rather than a standard allocation across crypto portfolios.

This article is for informational purposes only and does not constitute investment advice.