XAU₮: the Gold Dollar Is More Reliable Than the Paper One

XAU/USD

Key zone: 4,200.00-4,300.00

Buy: 4,350.00(on strong positive fundamentals); target 4550-4650; StopLoss 4,250.00

Sell: 4,150.00(on a confident breakout of the 4.200 level); target 4,000-3,950; StopLoss 4,250.00

We live in a world where every form of “new money” ultimately leans on old, time-tested assets. In the third quarter, Tether purchased 26 tons of physical gold — more than any central bank on the planet during the same period. According to unofficial estimates, the company has already accumulated roughly 116 tons, making it one of the largest non-sovereign holders of gold, comparable to smaller central banks such as Greece or Hungary.

Recall: central banks have been buying around 1,000 tons of gold per year for the third year in a row. This makes Tether a major marginal buyer: 116 tons equal more than $15 billion at current prices. The total supply of USDT in circulation stands at $184.7 billion, and gold now accounts for roughly 8% of the company’s reserves.

Why would a crypto company — whose token has become the standard for electronic settlements — accumulate physical gold?

• Part of the metal backs Tether Gold (XAU₮), a token redeemable for one standard ounce of physical gold stored in Swiss vaults;
• another portion functions as an investment in “hard assets” alongside U.S. Treasuries and cash;
• gold stored abroad acts as a political and legal hedge — far harder to freeze with sanctions than dollar-denominated accounts.

Tether’s logic is straightforward:

• if capital outflows from Treasuries accelerate, Tether benefits by promoting a digital gold product;
• growing global interest in gold as a reserve asset strengthens the marketing model: “USDT — for liquidity, XAU₮ — for capital preservation.”

Tether’s revenue sources include:

• minting and redemption fees for XAU₮;
• spreads from physical gold operations.

Thus, gold is not just a reserve for the company — it is a full-scale commercial product.

Not everyone in the market is thrilled that Tether is replacing Treasuries with more volatile assets to back its tokens. S&P Global downgraded USDT’s stability rating to the lowest tier, highlighting the riskiness of assets supporting the stablecoin: bitcoin was named the key risk, but gold also appears on the list. Tether CEO Paolo Ardoino called the rating “a weapon of the outdated financial system.”

Meanwhile, every new inflow of fiat money into stablecoins automatically increases the volume of gold purchases. Both the scale and speed of accumulation are rising.

The tokenized-gold market is also strengthening: XAU₮ and PAXG account for roughly 90% of the segment. Gold is becoming an integral part of crypto-infrastructure, while Tether is turning into a hybrid “ETF + custodian + USDT issuer” — which naturally raises more questions among regulators and investors.

What does this mean for a trader?

A scenario where gold reaches $5,000 per ounce as early as 2026 is becoming increasingly realistic. But with it will come a sharp rise in volatility in the precious-metals market — one that will be nearly impossible to control.

So we act wisely and avoid unnecessary risks.

Profits to y’all!