Tether’s XAUT surges as investors seek safety in tokenized gold amidst market volatility and unpredictable policy from the White House.
Gold Rally Makes Tether’s XAUT Top-Performing Digital Asset as Crypto Markets Remain Flat
Tokenized gold remains popular among crypto investors in Asia, with Tether‘s XAUT showing strong market performance. Despite a de-escalation in trade tensions, investors are drawn to gold due to concerns over unpredictable U.S. policy and a growing budget deficit.
Tether's XAUT is a stablecoin pegged to the value of gold.
It was launched in 2021 as part of Tether's efforts to expand its stablecoin offerings beyond fiat currencies like US dollars and euros.
XAUT is designed to provide a secure and transparent way for investors to hold and transfer gold-backed assets.
The stablecoin is issued on various blockchain platforms, including Ethereum and Tron.
XAUT has gained popularity among investors seeking to diversify their portfolios with gold-based investments.
The Safe Haven of Gold Amidst Market Volatility
Gold typically rallies during periods of heightened economic or geopolitical uncertainty, as investors seek safety in assets seen as stores of value amid volatility. While trade tensions have calmed, investors are concerned about the lack of predictability in policy from the White House. Additionally, the surging U.S. budget deficit has created concerns among investors, with the deficit increasing by $1.3 trillion halfway through fiscal year 2025.
XAUT Leads the Charge
On-chain data shows that Tether‘s XAUT was a top-10 market performer out of all digital assets. The tokenized gold, the largest by market cap, is up 3.4% in the last 24 hours. This strong performance can be attributed to its inverse relationship with interest rates: lower rates reduce the opportunity cost of holding non-yielding gold, making it more attractive.
Market Performance Amidst Stimulus Measures
China state media reported that stimulus measures are in the works for the country, with interest rate cuts and government spending to the tune of $136 billion proposed. Other market leaders include Curve DAO’s CRV, up 18% on-day after news that the U.S. plans to significantly relax rules pertaining to Decentralized Finance (DeFi).
