As Gold Prices Hit New Records, Gold-Backed Cryptocurrencies Experience Significant Growth Amid Trade Tensions

Gold-Backed Cryptos Surge as Precious Metal Hits Record Amid Market Uncertainty

Gold-backed cryptocurrencies are experiencing significant gains as gold prices surge nearly 10% this year, reaching a new all-time high of $2,880 per ounce. Rising geopolitical tensions and trade war fears between the U.S. and China have driven investors toward safe-haven assets, fueling demand for both physical gold and its tokenized counterparts.

Leading gold-backed digital assets, including PAX Gold (PAXG) and Tether Gold (XAUT), have closely tracked the metal’s rise, posting gains of approximately 10% year-to-date. These tokens, each backed by one troy ounce of gold held in secure vaults, are seeing increased investor demand amid market volatility.

Traditional gold-related equities have also benefited, with the VanEck Gold Miners ETF (GDX) soaring nearly 20% in 2025—substantially outperforming the S&P 500. Meanwhile, the supply of tokenized gold assets has expanded, with new mints outpacing token burns by millions of dollars each week. RWA.xyz data shows that transaction volumes for gold-backed cryptocurrencies have spiked over 53.7% on a monthly basis.

The broader macroeconomic environment has contributed to gold’s rise, with concerns over trade policies, a strong dollar, and seasonal demand from China’s Spring Festival fueling its momentum. In 2024, global gold demand reached 4,945.9 tons—valued at roughly $460 billion—according to the World Gold Council.

By contrast, major cryptocurrencies have struggled in early 2025. Bitcoin (BTC) has seen a modest 3.6% gain, pushing its ratio against gold to a 12-week low, while Ether (ETH) has tumbled over 17.6%. The CoinDesk 20 Index has barely moved, up just 0.5% year-to-date.

Despite this divergence, some market watchers believe bitcoin remains poised for a breakout. “This isn’t the failure of the ‘digital gold’ thesis—it’s just a temporary shift in capital flows,” said Mike Cahill, core contributor to the Pyth Network, in a statement to CoinDesk. “Right now, investors are prioritizing traditional safe-havens due to macro uncertainty, but when sentiment shifts, bitcoin could rally aggressively.”

Cahill added that BTC remains one of the hardest assets in existence, second only to gold. “If Trump’s pro-crypto policies come to fruition, we could see a wave of institutional adoption that propels bitcoin to new highs,” he noted.