In a testament to the growing demand for gold-backed digital assets, the total market capitalization of tokenized gold has exceeded $1.02 billion, after surging by 2.4% in the last 24 hours. This increase comes as gold prices soar to a 13-month high of $2,025.
At present, the competition for the top spot in the tokenized gold market is between PAX Gold and Tether Gold, with market capitalizations of nearly $523 million and $499 million, respectively. According to CoinGecko, the next closest competitor, the Perth Mint Gold Token, has a significantly smaller market cap of $2.46 million.
PAX Gold and Tether Gold are tokens pegged to the price of gold and utilize the same distributed ledger technology as Ethereum. This allows traders and investors to easily self-custody and trade on centralized exchanges.
New York-based fintech firm Paxos Trust Company issues PAX Gold, while Tether, the issuer of the dominant USD-pegged stablecoin, USDT, issues Tether Gold. Major centralized exchanges that trade these tokens include Kraken, Binance, and Bitfinex.
Both PAX Gold and Tether Gold saw significant price increases of over $2,000 in the last 24 hours, in line with the price of gold. PAX Gold increased by 2.7% and carries a slight premium, while Tether Gold increased by 1.9%.
The rise of tokenized gold assets comes as industrial metals experience a slump. As such, more investors and traders are turning to gold-backed digital assets as safe-haven investments.
