Gold-Backed Cryptos Soar as Precious Metal Hits Record High Amid Trade War Concerns
Gold-backed cryptocurrencies are outpacing the broader crypto market as gold surges nearly 10% this year, reaching an all-time high of $2,880 per ounce. The rally comes amid escalating trade tensions between the U.S. and China, fueling demand for the precious metal as a safe-haven asset.
Tokens like PAX Gold (PAXG) and Tether Gold (XAUT), which are each backed by one troy ounce of gold stored in secure vaults, have mirrored this price surge, climbing roughly 10% year-to-date. Meanwhile, traditional gold mining stocks have also seen significant gains, with the VanEck Gold Miners ETF (GDX) jumping nearly 20%—outpacing the S&P 500.
The growing investor interest has led to an expansion in gold-backed crypto supply, with new token mints consistently outpacing burns by millions of dollars each week. According to RWA.xyz data, transfer volumes for these tokens have spiked over 53.7% month-over-month.
Gold’s price momentum has been driven by a mix of factors, including heightened tariff threats from both the U.S. and China, increased demand during China’s Spring Festival, and a broader global appetite for the asset. Last year, gold demand reached 4,945.9 tons—valued at approximately $460 billion—according to the World Gold Council.
In contrast, most major cryptocurrencies have struggled in 2025. Bitcoin (BTC) has posted a modest 3.6% gain, pushing the bitcoin-to-gold ratio to a 12-week low, while Ether (ETH) has dropped over 17.6%. The CoinDesk 20 Index is up by just 0.5% year-to-date.
Despite this divergence, some analysts see bitcoin’s recent underperformance as a setup for future gains. “Gold’s rally and bitcoin’s dip don’t disprove the ‘digital gold’ narrative—they reinforce it,” said Mike Cahill, a core contributor to the Pyth Network, in a statement to CoinDesk. “Trade war fears and a strong dollar have driven capital into traditional safe havens, but once liquidity returns and risk appetite rebounds, bitcoin could rally sharply.”
Cahill added that long-term investors still view BTC as the hardest asset next to gold. “When Trump’s pro-crypto stance translates into actual policy changes, bitcoin stands to benefit massively,” he said.
