Monday, July 22, 2024

Gold-backed tokens sees massive growth, $1 billion as of March 7.

Traders have taken to digital tokens backed by gold due to inflation, geopolitical and financial market developments in recent times. This has led to unprecedented growth, as per Arcane Research, with gold-backed tokens valued at $1 billion on March 7.

This shows a 60% growth of unique or rare cryptocurrencies, primarily PAX Gold (PAXG) and Tether Gold (XAUT). These gold stable coins are regarded topmost because their prices are linked closely with gold. PAXG and XAUT token is equal to one troy fine ounce of gold. Both tokens have been up more than 8% since January 1.

Experts said that the gold stable coin market cap increase is driven by the rising price of the precious yellow metal. It has gained significantly given the recent geopolitical tensions between Russia and Ukraine. Stock markets highlighted that gold reached a 13-month high on February 24. When Russia invaded Ukraine, the price of PAX jumped to $2,043 in the first 12-hours, and Tether jumped to $1,978. Heightening geopolitical tensions and high inflation has boosted the demand for gold-backed tokens.

Gold-backed tokens/cryptocurrencies are publicized as a liquid way to invest in an asset that tracks gold prices without having to purchase an actual gold bar. Experts described this as buying an ETF that replicates the price of gold. But with gold-backed tokens, investors can exchange them for physical gold than mere cash.

Companies and investors are digitizing the value proposition of gold, resulting in a liquid-crypto asset backed by the benefits of physical gold.

Cryptured Team
Cryptured Team
The writers team at Cryptured.com is composed of passionate and experienced journalists who cover the latest developments in the crypto and blockchain space. They aim to provide accurate, unbiased and easy-to-understand news and information for their readers, as well as insights and analysis from industry experts. The writers team is always on the lookout for new and exciting stories that can help the general public learn more about the potential and challenges of these technologies.
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