Gold tokenization is an emerging trend in the digital asset space, where physical gold is converted into blockchain-based tokens. Each token represents a specific amount of real gold stored in secure vaults and can be traded globally 24/7. This makes gold more accessible, faster to trade, transparent, and cost-efficient—especially as gold prices rise and economic uncertainty grows.
👩🏻💻 To learn more about gold-backed cryptocurrencies, check out the article What Are Gold-Backed Cryptos? A 2025 Buying Guide on Pintu Academy.
Tether Gold (XAUt) is a compelling alternative, combining the stability of gold with the flexibility of cryptocurrencies. Backed 1:1 by physical gold, XAUt can be traded like any other crypto asset without the hassle of storing physical bullion.
In this article, we’ll take a closer look at what Tether Gold (XAUt) is all about.
Article Summary
- 🪙 XAUt is a gold-backed stablecoin developed by Tether and launched in January 2020.
- 🔗 It operates on both Ethereum (ERC-20) and TRON (TRC-20) blockchains, enabling fast, transparent, and efficient transactions.
- 🧱 Each XAUt token represents one troy ounce (31.1 grams) of gold bars that meet London Good Delivery standards and are securely stored in Switzerland.
- 📊 Its goal is to digitize gold and create a stable asset accessible globally without the need for physical gold storage.
- 💸 Key benefits include: 24/7 access, no storage fees, high liquidity, and security with transparent audits conducted by BDO Italia.
- 💼 XAUt can be used in DeFi platforms, lending protocols, and as a hedge against inflation in both bull and bear markets.
- ⚠️ Risks include: reliance on gold custodians, blockchain-related vulnerabilities, gold price volatility, and regulatory uncertainty.
What Is Tether Gold (XAUt)?
Tether Gold (XAUt) is a stablecoin fully backed by physical gold. Each XAUt token represents one troy ounce (approximately 31.1 grams) of gold bars that meet London Good Delivery standards and are securely stored in vaults. Backed by a real-world asset, XAUt offers greater price stability compared to typical cryptocurrencies, making it more resilient to market fluctuations.
💡 Learn more about What is a Stablecoin on Pintu Academy.
XAUt is built on Ethereum and TRON blockchains, utilizing the ERC-20 and TRC-20 token standards, enabling fast, transparent, and secure trading across various platforms.
The main goal of XAUt is to digitize the value of gold and offer a stable, trusted, and neutral monetary asset. By combining gold’s role as a store of value with the efficiency of crypto technology, XAUt aims to provide a modern alternative for investors seeking stability in the digital financial ecosystem.
History and Background
Tether Gold (XAUt) was developed by TG Commodities Limited, a subsidiary of Tether, and officially launched in January 2020. The token was designed as a modern solution for owning gold in digital form.
Since the emergence of Bitcoin in 2009, many have referred to it as “digital gold” due to its limited supply and resistance to inflation. However, Bitcoin’s high price volatility makes it less ideal for those seeking a stable store of value.
This is where XAUt stands out—as a more stable alternative, directly backed by physical gold, a precious metal that has served as a reliable hedge against economic crises for centuries.
The core mission of Tether Gold is to make gold ownership simpler, more efficient, and more affordable through blockchain technology. Traditional gold ownership tends to be expensive, complex, and involves numerous intermediaries.
With XAUt, users can buy, send, or store gold using only a crypto wallet—all done digitally and instantly. This significantly broadens access to gold as a hedge asset, without the logistical challenges or storage costs associated with physical gold.
📚 Note: XAUt is a digital gold token developed by Tether, designed to make gold ownership more efficient and stable through blockchain technology—eliminating the need to store physical gold directly.
How Does XAUt Work?
Tether Gold (XAUt) was developed with a transparent and user-friendly structure to help users understand how it functions. XAUt is a digital token built on two major blockchain networks: Ethereum (using the ERC-20 standard) and TRON (using the TRC-20 standard). This enables XAUt to be used across a wide range of decentralized finance (DeFi) ecosystems and traded globally with high speed and low transaction fees.
Each XAUt token represents one troy ounce of gold bars that meet London Good Delivery standards, stored in high-security vaults in Switzerland. Each wallet address holding XAUt is directly associated with specific physical gold. For efficiency, Tether’s system automatically manages and simplifies the allocation of gold backing the circulating tokens.
As a measure of transparency and trust, Tether Gold is regularly audited by an independent third party, BDO Italia. These audit reports are published on a recurring basis to verify that the amount of physical gold held in custody matches the total supply of XAUt in circulation—ensuring authenticity, completeness, and transparency of the asset for investors.
Advantages of XAUt
Tether Gold (XAUt) offers a modern and efficient way to invest in gold, with several advantages over owning physical gold or investing through ETFs (Exchange Traded Funds).
Here are some key reasons why XAUt stands out as a superior gold investment option:
1. 👩🏻💻 Easy and Affordable Access
XAUt can be bought and traded 24/7 on various global crypto exchanges—unlike physical gold markets, which are limited by operating hours. Additionally, investors can purchase fractional amounts down to six decimal places, allowing anyone—even with limited capital—to invest in gold without needing to buy a full gold bar.
2. 📈 High Liquidity
XAUt is available on multiple digital asset trading platforms, making it easy to buy or sell without the need to find a direct buyer or seller. This ensures high flexibility, especially during rapid market shifts.
3. 🔐 Security and Transparency
The gold backing each XAUt token is stored in secure vaults in Switzerland—a country known for its stringent asset storage regulations and high security standards. Tether also offers an online verification feature, allowing XAUt holders to directly check the gold reserves underlying their tokens—enhancing transparency and investor confidence.
4. 💸 No Storage Fees
Unlike physical gold, which requires additional costs for storage and insurance, XAUt charges no storage fees to token holders. Investors gain exposure to gold prices without dealing with the logistical and financial burdens of storing physical assets.
5. 🏦 Fast and Simple Transfers
XAUt can be transferred between digital wallets quickly via the Ethereum or TRON blockchain networks. This is a major improvement over physical gold, which requires special shipping, longer time frames, and high insurance costs.
6. 📚 Hedge Against Inflation
Like traditional gold, XAUt serves as an effective hedge against inflation and economic uncertainty. However, its digital form makes it far more accessible and easier to manage—without compromising its reliability as a long-term store of value.
Risks and Considerations
Before investing in Tether Gold (XAUt), here are several risks and important factors to consider:
1. 🏦 Custodial Risk (Physical Gold Storage)
Although the physical gold backing XAUt is securely stored in Swiss vaults and audited regularly, there’s still a risk associated with custodianship—such as potential operational failure or mishandling. Investors must rely on third parties (custodians) to ensure the gold truly exists and matches the reported amount.
2. 📊 Blockchain and Technology Risk
Since XAUt operates on Ethereum (ERC-20) and TRON (TRC-20), users are exposed to risks such as high gas fees, network congestion, or technical disruptions. Additionally, digital assets face general risks such as wallet hacking or loss of private keys.
3. 💻 Regulatory Uncertainty
The regulatory landscape for stablecoins and commodity-backed crypto assets like XAUt is still evolving. Changes in government policies or new regulations in certain jurisdictions may affect liquidity, accessibility, or even the legality of holding XAUt.
4. 📈 Gold Price Volatility
Although more stable than most cryptocurrencies, gold prices still fluctuate with global market conditions. Investors should be aware that XAUt’s value is directly tied to real-world gold price movements.
5. 💰 Investment Objectives and Risk Profile
XAUt is best suited as a store of value or inflation hedge—not as a vehicle for short-term speculation. Make sure your investment in XAUt aligns with your financial goals and personal risk tolerance.
XAUt in the Crypto Ecosystem
XAUt plays a key role in the crypto ecosystem as a form of digital gold usable across various decentralized finance (DeFi) applications, lending services, and even as a payment method. Thanks to its integration with Tether and compatibility with both the Ethereum (ERC-20) and TRON (TRC-20) networks, XAUt can easily be used in smart contracts, liquidity pools, or as collateral in crypto lending protocols.
As an alternative to traditional gold investment within the crypto space, XAUt allows investors to access the stability of gold without needing to physically own or store it—making it an ideal choice for those who want to preserve value while remaining active in the digital economy.
How Investors Use XAUt in Bull and Bear Markets:
📊 Bear Market (Declining Prices)
When traditional markets or crypto experience sharp downturns, investors often shift funds into more stable assets like gold. In the digital context, XAUt becomes a go-to asset for protecting capital against extreme volatility. Since gold tends to rise during high inflation or economic distress, XAUt offers an effective safe haven without exiting the crypto ecosystem.
📊 Bull Market (Rising Prices)
Even though gold typically doesn’t experience the same explosive gains as crypto assets, XAUt provides portfolio stability. Investors often use it to balance their portfolios and reduce exposure to highly volatile crypto assets. Including XAUt in an investment strategy helps maintain a portion of stable assets amid an upward-trending market.
How to Buy and Store XAUt
To start investing in Tether Gold (XAUt), you can purchase it through supported exchanges such as Pintu. The steps are simple:
- Open the Pintu app homepage.
- Navigate to the Market section and search for XAUt or Tether Gold.
- On the token’s page, you can view XAUt price charts over different timeframes—24 hours, 1 week, 1 month, or 1 year. Once there, tap Buy.
- Enter the amount of XAUt you wish to purchase.
- Tap Continue.
The Pintu app is also compatible with popular digital wallets like MetaMask, making your transactions even more convenient. Download the Pintu app now on the Play Store or App Store! Your security is ensured, as Pintu is regulated by OJK (Indonesia’s Financial Services Authority) and CFX (Commodity Futures Trading Regulatory Agency).
In addition to trading, Pintu also enables you to learn more about crypto through a wide range of educational articles on Pintu Academy, updated weekly.
All articles published by Pintu Academy are intended for educational purposes only and do not constitute financial advice.
Conclusion
Tether Gold (XAUt) offers an innovative solution for gold investment in the digital age. Backed 1:1 by physical gold and powered by blockchain technology, XAUt allows users to buy, store, and trade gold globally with speed and security. It provides the price stability of conventional gold while offering the flexibility of a digital asset that can be used across DeFi platforms, lending protocols, and payment systems.
However, like any investment, XAUt carries risks—including custodial risks and regulatory uncertainties. Therefore, it’s important for investors to understand how the asset works, its benefits, and potential challenges before committing funds. With the right approach, XAUt can serve as a strategic and efficient hedge in both crypto and traditional portfolios.
References:
- Bybit Learn. Tether Gold (XAUt): Secure Digital Gold Ownership. Accessed on June 19, 2025
- Debut Infotech. Gold Tokenization Explained: A Complete In-Depth Guide. Accessed on June 19, 2025
- Mobee. What is Tether Gold (XAUt) and Why is it Relevant in the Current Market? Accessed on June 19, 2025